Indian startups Paytm and Zomato have driven a gain of $400 million for SoftBank’s Vision Fund, according to the Japanese investment firm’s latest financial filings. During the quarter ending June 30, 2023, Paytm contributed $200 million to the fund’s gain, while Zomato and Delhivery added $100 million each. However, SoftBank did not report any gains or losses from its investment in PB Fintech during this period.
The gains from these startups mark a significant improvement compared to the previous quarter when they contributed around $140 million to the fund. The growing market value of these tech startups, along with their positive financial results and progress towards profitability, have played a role in this improvement. In fact, Zomato turned net profitable in the first quarter of the fiscal year 2023.
Nevertheless, Paytm and Zomato still contribute to SoftBank’s Vision Fund’s overall loss. As of June 30, 2023, Paytm individually accounted for a loss of $335 million, while Zomato’s total contribution to the loss stood at $46 million. However, these figures represent a significant improvement compared to the previous quarter, where Paytm contributed $526 million and Zomato contributed $131 million to the fund’s losses.
SoftBank’s recent filing also revealed that it has offloaded shares in Paytm, Delhivery, and Zomato in multiple tranches. The company’s holdings in these startups have decreased since March 2023. Despite these divestments, SoftBank’s total loss on investment decreased to ¥699 billion ($4.9 billion) in the first quarter of the fiscal year 2023, down from a loss of ¥2,834.4 billion ($19.8 billion) in the same period of the previous year.
SoftBank had significantly reduced its investments in India over the past few years, partly due to mounting losses. In 2021, the company invested over $3 billion across 17 deals, which declined to only four rounds in 2022. However, SoftBank stated that its funds (SVF1, SVF2, and LatAm Funds) are now resuming investments. In the first quarter of the current fiscal year, these funds invested $0.9 billion, up from $0.4 billion in the previous quarter.
In conclusion, Indian startups Paytm and Zomato have contributed significantly to SoftBank’s Vision Fund, driving a gain of $400 million in the first quarter of the fiscal year 2023. Despite their contributions to the fund’s losses, their positive financial results and improving market value are a promising sign for these tech startups and their investors. As SoftBank resumes investments in India and other regions, it will be interesting to see how these startups continue to grow and contribute to the fund’s performance.
