SoftBank

The 'sucker round': celebrity and SoftBank money as a kiss of death

On Whoop's $200M raise (valuing it ~$3.6B), Shaan jokes that when SoftBank plus athletes like Kevin Durant pile in, that's not a Series F, it's the 'sucker round', a signal late money is chasing froth.

“Whoop is $3.6 billion. Oh, and also the wonderful kiss of death. SoftBank and then Kevin Durant and other athletes are investing. You know, that's, that's called the sucker round. It's not called the Series F. It's called the sucker round.”

GoPuff: profitable on 500 campuses, then a $200-300M SoftBank check

Shaan describes GoPuff, the campus-focused instant-delivery company, as operating on roughly 500 campuses and doing hundreds of millions a year. It was profitable before SoftBank invested $200-300 million to fuel aggressive growth.

“They're on like 500 campuses or something. They're doing hundreds of millions a year. They were profitable, then SoftBank backed up the truck and invested like $200-300 million into the company.”

Sheldon Adelson built a casino empire starting with a trade show

Sam recounts how Sheldon Adelson started Comdex, an '80s personal-computer trade show, sold it to SoftBank for $1 billion (later renamed CES), and used trade shows as the on-ramp to building the Las Vegas Sands hotel empire.

“The way that he started that was he started this thing called Comdex, which was a trade show. It stood for, it was like personal computers. He started it in the '80s. Eventually he sold it for $1 billion to SoftBank and it was renamed CES.”

Felix Dennis built Micro Warehouse from zero to public in 4-5 years

Discussing the missing 'software publisher' model, Sam recalls the 1980s-90s software-store era: SoftBank used a tech magazine to sell software, and Felix Dennis's Micro Warehouse went from zero to a publicly traded company in about 4-5 years acting as a warehouse store for software.

“His name was Felix Dennis, and he had Micro Warehouse, and it was a warehouse for software, and you could go and buy whatever you want. And they went from zero to publicly traded company in like 4 or 5 years. Massive.”

GoPuff: $163M/year on campus convenience delivery

Shaan cites GoPuff as proof the campus fast-delivery model works: it is doing about $163M a year, and he notes it has now raised $866M (with SoftBank backing).

“so they're, they're at $163 million a year, um, is the, is the thing. And I don't think they even raised that much money. Like, let me look at their fundraising for, for GoPuff. I don't think they raised too much. Oh no, they have now raised a lot. How much? $866 million.”

Brandless died because it raised $200M from SoftBank before product-market fit

Shaan argues Brandless had a great premise but raising $200M from SoftBank before achieving product-market fit set billion-dollar expectations that crushed the company.

“They raised a shit ton of money from SoftBank, like $200 million before they really achieved any product market fit. And that sort of like was the death note for the company because it was just a, the expectations when you raise $200 million is you're gonna be, you know, a billion-dollar-plus company, and if you do that too early and you haven't actually proven out your model, you haven't figured it all out, expectations crush the business.”

Steal thisDon't raise mega-rounds before proving the model; oversized funding sets expectations that kill you.

CES founder built COMDEX, sold to SoftBank for $1B, became a casino billionaire

Sam notes the man who started the trade show that became CES originally called it COMDEX in the 1980s and sold it to SoftBank for $1 billion. That man, Sheldon Adelson, went on to become a casino magnate worth around $15 billion.

“the guy who started CES, he originally called it COMDEX in the 1980s, and then he sold it to SoftBank for $1 billion. And that guy, his name is Sheldon Adelson. He's worth $15 billion and is one of the richest men in the world”