BUSINESSWEEK ONLINE : SEPTEMBER 27, 1999 ISSUE
COVER STORY -- E.BIZ -- THE E.BIZ 25

Masayoshi Son


MASAYOSHI SON

SOFTBANK CORP., JAPAN

Position: Contribution: Ambitions: Position: Founder and CEO

Contribution: With $2 billion invested, one of the biggest backers of Internet startups worldwide.

Ambition: To pull Japan out of the Web dark ages and dominate e-commerce in Asia.

He's admired, envied, and even feared by some. But there's no denying that Masayoshi Son is single-handedly dragging Japan into the Information Age. Once scorned by the Establishment, Son now regularly gets face time with Prime Minister Keizo Obuchi. And there isn't an executive in Japanese finance, retailing, or high tech who isn't in awe of the clout Son now has over Japan's emerging Internet economy.

Small wonder. Since 1995, Son's Softbank Corp. has made perhaps the savviest venture-capital bets of all time by taking equity stakes in what are now the hottest sites on the Web. Think about Yahoo! Inc. (YHOO), GeoCities, E*Trade (EGRP), or E-Loan (EELN). Son owns a piece of all them. He has parlayed startup investments of nearly $2 billion into paper profits now worth $15 billion. And his own net worth tops $2 billion.

Had he stopped there, Son might just have been remembered as a shrewd Silicon Valley sugar daddy who struck it rich. But he has no intention of slowing down. In what might be the model for global expansion of e-commerce, Son is binding together his 100-plus confederation of companies into a cyber-conglomerate that will expand into Asia and Europe. At its core is his Softbank, a sprawling empire in Japan and in the U.S. that includes software, retailing, magazines, Web publishing, and computer trade-show properties, with a market cap of $38 billion--exceeding that of Toshiba.

His first big target is Japan, which Son figures is ''missing out on a dramatic world movement.'' Son already has set up joint ventures there with Yahoo and E*Trade. His basic strategy is to import U.S. Web sites into Japan, where there is precious little experience in commercializing the Internet.

He's also smashing through some barriers that have held Japan back. The irrepressible dealmaker has clinched a deal to create a U.S.-style Nasdaq over-the-counter market next year for high-tech startups that bypasses Japan's restrictive small-cap market. He also plans to offer the service free to Japanese schools for a decade to kick-start interest in the Net and get Japan's personal-computer penetration to U.S. levels.

That has endeared him to officialdom. The government is counting on e-commerce and business-to-business transactions to lower Japan's bloated price structure and spur a productivity surge, as they have in the United States.

WITH A SHRUG. Yet others worry that a country that has always wanted its own Bill Gates should be careful what it wishes for. Son and his alliance directly or indirectly control 70% of listed Internet companies in Japan. And if Softbank controls 60% of Nasdaq Japan as planned, would Son's friends get preferential treatment? ''It will be like having your cake and eating it too,'' worries Joichi Ito, chairman of competitor portal Infoseek Japan. Others worry that Son is selling out Japan and letting U.S. companies into the most lucrative niches of the Net in Japan.

Son shrugs off the criticism. He vows his Nasdaq will treat all comers fairly. And he says his co-ventures with U.S. companies are good for the Japanese consumer. ''I keep hearing about Son bringing in the black ships,'' he says, alluding to U.S. gunboats that forced Japan to open up during the Meiji era.

In a way, Son himself is the alien invader--but it's a positive thing. By dint of his drive and vast wealth he's proving something of an inspiration to Japan's home-grown Netrepreneurs. The irony is rich. Son is an ethnic Korean who suffered ridicule and once had to beg for startup financing from Tokyo lenders. Now, this cybermogul may be Japan's best hope to make a necessary and speedy transition into the Internet Era.

By Brian Bremner

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[empire builders]
Jeffrey P. Bezos
AMAZON.COM INC.

Stephen M. Case
AMERICA ONLINE INC.

Timothy A. Koogle
YAHOO! INC.

[the innovators]
Louis H. Borders
WEBVAN GROUP INC.

Jay S. Walker
PRICELINE.COM

Margaret C. Whitman
EBAY INC.

Glen Meakem
FREE MARKETS ONLINE INC.

James H. Clark
MYCFO INC.

Christos M. Cotsakos
E*TRADE GROUP INC.

[bankrollers]
Masayoshi Son
SOFTBANK CORP., JAPAN

Robert C. Kagle
BENCHMARK CAPITAL

Lawton W. Fitt
GOLDMAN SACHS & CO.

L. John Doerr
KLEINER PERKINS CAUFIELD & BYERS  

Bernard Arnault
LVMH MOET HENNESSY
LOUIS VUITTON  

[the visionaries]
Mary G. Meeker
MORGAN STANLEY DEAN WITTER

John Hagel III
MCKINSEY & CO.

William Joy
SUN MICROSYSTEMS

[the architects]
Louis V. Gerstner Jr.
IBM CORP.

Pehong Chen
BROADVISION INC.

David C. Peterschmidt
INKTOMI INC.

Kevin J. O'Connor
DOUBLECLICK

Ellen M. Hancock
EXODUS COMMUNICATIONS

[the pace setters]
David S. Pottruck
CHARLES SCHWAB CORP.

John T. Chambers
CISCO SYSTEMS

Michael S. Dell
DELL COMPUTER



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