Gambling Man: The Secret Story of the World's Greatest Disruptor, Masayoshi Son

by Lionel Barber

This book was a fascinating read, I couldn’t put it down. Despite the criticism Masa and SoftBank often receive, a few takeaways really resonated:

1. What convinces is conviction.

2. If the reward is big enough, the entry price doesn’t matter.

3. When something isn’t working, double down rather than retreating.

Highlights

Part One: Boy Genius

2. Pachinko

• Watching his father, the young Masa would have learned several things: the terrifying fear of destitution, the outsider’s relentless struggle for survival, the bitter truth that no one will help you but yourself, as well as the endless corner-cutting, hustle, and reinvention required of an entrepreneur operating on the margins of society. p19

• Mitsunori Son, eighty-seven, reflected upon the moment he realized his second son Masayoshi was cut from a different cloth, a young boy possessed of stubbornness, self-belief, and unlimited ambition. Masa was six years old, and he was sumo-wrestling with his elder brother in the family home. Masa lost the fight, but he refused to give up. Nothing would stop him, not even when his father tried to pull him away. Mitsunori still remembered the look in Masa’s eyes. “They were like an animal’s, a wolf’s eyes,” he chuckled. “I thought to myself: ‘Wow, this bastard is not human.’ ” p19

• “Because Masa is convinced that he’s a genius, the good ideas follow. If you truly believe you’re strong, you’re a genius, then failure just bounces off you, you drive failure away through sheer willpower.” p20

• Convinced of his own technocentric worldview, he truly believes he can see into the future and make it reality in the present. “Masa thinks that if something could happen, it should happen. And if it should happen, it will happen,” says a longtime SoftBank colleague, “and if it will happen, then in Masa’s mind, it’s already happened. He’s already visualized it.” p20

• When Mitsunori said he’d bought a café on the fringe of town and was worried about how to attract customers, Masa, no more than eight years old, had the answer. Hand out free coffee vouchers, and the customers will come and spend money on other items. p20

• Once, before being sent on a five-mile run, he worked out how to take a shortcut. To this day, he insists that he imagined the route in his own head rather than reading a map ahead of the race. p20

3. American Awakening

• Half a century later, Masa recalled his emotions on setting foot in America: “I said to myself, ‘What a small man I’ve been. I’m not gonna escape anymore, I’m gonna fight. I’m gonna prove that I’m an equally good man, not an inferior guy, okay?” p28

• Like Tesla founder Elon Musk, another socially awkward character, Masa had an ability to persuade others that he was a genius, or at least a genius-in-waiting. His lack of social graces made him authentic and endearing, allowing him to win admiration and trust. p35

4. Lost in Translation

• Lu was initially unenthusiastic. He had an engineering degree from Berkeley; now he was being asked to set up a business little different from a pinball machine. Masa begged to differ, arguing that a consumer electronics hit in Japan would soon become a hit in the US. Buying unsold video game cabinets at a discount, he could ship them to a “fresh” American market. Instead of sending them by sea, he would choose more expensive air freight, cutting transportation time from three months to three days—a vital competitive edge when dealing with products with a limited shelf life. p46

5. SoftBank 1.0

• The software vendors missed the point. In a new industry, marketing, not profits, was what mattered. Intent on creating a name and a brand, Masa put up a giant sign: “Now the revolution has come for software distribution for PCs.” Visitors packed into his booth. But nobody signed up for a dealership. Masa blew 80 percent of SoftBank’s start-up capital and sold only $3,000 of software products. p53

• In May 1982, Masa launched a publishing division with two new monthly magazines, Oh! PC and Oh! MZ, to promote his software. He printed fifty thousand copies, which didn’t sell. Nor did they attract serious advertising. Some 85 percent of the magazines were returned. Soon all the software business profits were wiped out. SoftBank staff were close to rebellion, but Masa insisted on staking everything on one last issue. He doubled the size of the magazine, changed the layout, doubled the print run to one hundred thousand copies, and kept the price the same. The result was a sellout. His willingness to stake all in the face of adversity marked the difference between success and failure and would be repeated time and again over his business career. p56

Part Two: Rise and Fall

6. Miracle Cure

• Proving that life is stranger than fiction, he happened to meet an engineer in Toranomon Hospital who was also suffering from chronic hepatitis. The patient, Sakano, said the idea looked promising. When Masa asked how long it would take to make a prototype, the answer was two months.

  “I don’t have two months,” said Masa. “Make it three weeks.”

  The two men met regularly in their pajamas in the hospital ward to check on progress. Near the three-week deadline, after fiddling with numerous wires, Sakano shouted: “Son-san. I got the prototype working.” A year or so later, progressively weakened by disease, he died. p69

7. Mr. Gateway

• He had no time for consensus-building; he wanted on-the-spot decision-making. His three favorite words were: “Let’s do it.” p73

8. Paper Billionaire

• When SoftBank started out, software was dispatched in packaged boxes. By the early 1990s, the new thing was the CD-ROM, a prepressed compact disc that contained multiple demo versions of software. Masa distributed the CD-ROMs through SoftBank’s computer magazines. If customers wanted the full version, they contacted call centers that could remotely enable the software. p86

• Masa wanted to show he was a man of his word. Fisher warned him that he couldn’t trust people simply by looking them in the eye; one day, he would be dealing with rougher types.

  “That’s their problem, it’s not my problem,” Masa replied. “I’m not going to change how I work.” p87

• Having watched his family escape poverty, he was by nature an optimist who wanted to believe the best of everyone. p87

• The deal was unusual because Masa didn’t push for 100 percent control, and he forfeited his right to voting stock. When Levy asked why the young Japanese tycoon wasn’t worried about exercising his voting rights as majority shareholder, Masa’s matter-of-fact reply took the New Yorkers aback:

  “Why would I want to vote? You are the ones running the company!” p88

• He produced a stack of charts and decks that laid out a three-hundred-year vision for SoftBank. p89

9. What Does It Take to Win?

• The idea that he’d overpaid for Comdex never occurred to Masa. At a stroke, the young man from Japan was a player. He wasn’t “one of the small guys standing in a two-hour line with a badge waiting to get into the convention.”10 Soon he would be high-fiving onstage with Bill Gates and Steve Jobs. He didn’t care about short-term profits or cashing out like Sheldon Adelson; he was cementing SoftBank’s place in the US, the land of cutting-edge high-tech innovation. p95

10. Yahoo!

• Yahoo! needed millions to invest to establish itself as a top-class consumer brand, Masa argued. When Yang and Filo continued to stall, he turned to Gary Rieschel, SoftBank’s new venture capital recruit, and asked him to name Yahoo!’s top competitors.

  Rieschel: Well, there’s Lycos, Excite, and AltaVista.

  Masa: Which is the strongest competitor to Yahoo!?

  Rieschel: Excite.

  “Well,” said Masa, with a touch of menace, “if I don’t invest in Yahoo!, I will invest in Excite and I will kill you.” p105

12. Whistleblowers

• Masa wanted to create the greatest start-up ever seen in Japan. He disdained the “salaryman culture,” where employees were given lifetime job security in return for ninety-hour working weeks, respect for seniority, and undying loyalty to the company. Under Masa, SoftBank’s culture was half–can-do American, half–Japanese ninja warrior: agile, dynamic, and unpredictable. p124

13. Bubble Man

• Masa was always doubling down, never quitting. The bigger the sums, the better—because that way lay outsize returns. The man’s risk appetite knew no bounds. p134

• As an investment, you may make money, but what you want to do is a digital information revolution. Don’t lose focus by getting involved in all sorts of things.” p139

• Others marveled at Masa’s limitless attitude to risk. Their stomachs churned as stocks shot higher and the sums of money at risk grew ever greater. Masa saw things differently. If you are born in a slum with nothing, losing everything is relative. You just go back to square one. Then, like the Korean slum dwellers in Tosu, you build back up. p141

14. The Crash

• Alibaba’s online business was barely six months old. The company’s only revenues were a few meager sponsorship deals on a clunky website, but it was pulling in more than a thousand new registered users a day, an explosive rate of growth in a mass market.

  Masa understood the commercial opportunity immediately. He was also drawn to the hungry look in Ma’s eye, the “animal smell” of a fellow underdog. He offered Alibaba’s founder $40 million on the spot, in return for 49 percent of the equity. Ma turned down the opening bid, but said he would consider $20 million: “Alibaba is just a baby, and a baby does not need this amount of cash.”2

  It took guts—or epic foolishness—to turn down Masayoshi Son. p142

• Around this time, he began writing and rethinking SoftBank’s business plan according to where technology was heading. “I’m probably on version one thousand of my vision or something,” he said in October 2023. “Even today.” p147

Part Three: The Operator

15. Broadband Revolution

• When people told him he was crazy taking on NTT, one of the biggest and most valuable companies in the world, he had a typically cheeky riposte.

  “Well, that makes me excited. If I fight with the small guy I feel it’s an unfair fight, but if I pick a guy who is the toughest, the biggest, then I can be serious. It’s a fair fight. People looked at me and were lost for words. ‘You are truly crazy.’ ”

  Masa never entertained failure. p156

• Two decades later, Bonfield admitted he missed the larger point: Masa had grasped the new economics of the digital revolution far earlier than rivals. By now Masa’s mantra was familiar: customers and market share mattered more than cash flow and profitability. “The value was dollars per customer,” Bonfield said. “He was right, and we were wrong. p157

16. Golden Goose

• Ma argued it was pointless distinguishing between consumer and business users. Small-business and consumer behavior was similar, because one individual usually made decisions for the whole organization. p169

• When Taobao was launched on May 10, 2003, visitors to the website had no means of identifying its connection with Alibaba—or SoftBank. Masa and Ma followed Sun Tzu’s advice in The Art of War : “Let your plans be dark and impenetrable as the night, and when you move, fall like a thunderbolt.” p169

• The challenge was not just how best to generate a critical mass of online traffic; the billion-dollar question was whether to prioritize buyers or sellers. “If you have no products online you don’t have buyers,” Tsai explained. “The problem then is that sellers won’t come to the marketplace.”

  Masa was adamant that Taobao make listings free for sellers. With an abundant number of products on offer, buyers would flock online. p170

18. Steve Jobs to the Rescue

• Jobs offered Masa some advice that he might have taken on board in later years. “Masa, doing one thing right is super tough. And two people can do 99 percent the same thing, but 1 percent makes a huge difference. I don’t want to get distracted. I would rather focus on doing one thing right.” p192

• Technology mattered, but personal chemistry counted even more. “There was a deep connection between Masa and Steve Jobs,” says Ron Fisher, SoftBank’s man in the US, who attended several meetings between the two men. “Jobs understood that when you are trying to change consumer behavior in a place like Japan, you need a maverick.” p193

• Goto, who went on to be SoftBank’s chief financial officer, was mortified by his misjudgment in investing in CDOs with Goldman Sachs. He asked for an appointment with Kasai, where he presented his boss with his letter of resignation. When he saw it, Kasai shouted at Goto: “You fool! If you have time to write that, spend it instead thinking up a way to get through this!” p195

Part Five: The Empire Builder

19. Thirty-Year Vision

• There was a certain tragic quality to Masa’s endless ups and downs. Forever eyeing the future, he was incapable of dwelling on past or present accomplishments. It was a recipe for perpetual dissatisfaction. p201

• Through the missteps and setbacks, he drew comfort from his technocentric view of the world and his faith in human progress. Even if his timing was sometimes off, he was right about the general direction. As he once observed: “One should not follow the times. You need to read them, set things in motion and wait.” p201

• When Masa led his Thirty-Year Vision brainstorming sessions, he usually began with a piece of advice: start with the conclusion. The destination was key. Another tip was: when you are lost, look further into the distance. “The reason you can’t envision it clearly is because you’re limiting your field of vision to 30 years,” he explained, reminding them of his favorite time frame. “Start bold and think 300 years ahead. Then you can work backwards to what things will be like 30 years from now.”p208

20. Fukushima

• The rebuff in the disaster zone had been disappointing, humiliating even. But rather than reflect or retreat, it had led him to escalate, proposing an even vaster scheme, one that would place him as the leading protagonist in a national tragedy of historical proportions. p217

21. Sprint

• In global terms, the new SoftBank-Sprint combination had ninety-six million customers, making it the world’s third-largest mobile operator, behind China Mobile and Verizon. “I am a man,” Masa said, “and every man wants to be number one, not number two or three.” p225

• [Marcelo Claure’s] formula was deceptively simple: buy cheap, sell expensive. p227

Part Five: Hubris

24. Project Crystal Ball

• Sovereign investors in the Gulf had all the money but few of the connections. He could assume his familiar role as a bridge, this time between the Middle East and Silicon Valley, the global hub of technological innovation and the world’s premier center for venture capital. Bristling with excitement, he came up with a suitably grandiose name for his new venture: the SoftBank Vision Fund. p260

• En route to the hotel in Doha, Masa suddenly and dramatically veered off script. Without forewarning, he announced that the investment fund target was no longer the originally planned $20 billion; not even $30 billion. The new target was $100 billion. By every known measure, $100 billion was a dizzying multiple compared to the average $2–5 billion raised every funding cycle by the top VC firms in Silicon Valley. It posed questions as large as the target itself: Where should such huge sums be invested, who was qualified to make such decisions, and how would the new Vision Fund operate? When al-Bassam protested that the $100 billion figure was unrealistic, Masa brushed him aside. “If I am going to do a fund, it has to be big enough to disrupt the whole technology world. p262

• On the return flight, Masa peppered Al-Bassam with questions about the history of Saudi Arabia, its culture, and the character of the prince. Masa’s appetite for knowledge was insatiable. He’d long since given up reading books (though he claimed to have read hundreds while bedridden in hospital with hepatitis B), preferring instead to consume well-chosen articles or, even better, listen to experts. That night he kept Al-Bassam awake for all but one hour of the ride to Tokyo. p263

• “You have three weaknesses,” he said sternly: “You are a one-man show; you went from hero to zero to hero. How do we know you don’t go to zero again? Is your track record just from a few deals?”

  Masa shot back: “How many people come back after losing 98 percent of their wealth?”

  The frosty atmosphere gradually eased. After seventy-five minutes, both men were hugging and taking photographs together. The Saudis were falling under Masa’s spell. p264

• At the end of their encounter, MBS approved in principle a $45 billion investment in the Vision Fund, a colossal sum that dwarfed any single contribution to a venture capital fund by a factor of ten or more. The Saudis were not merely cornerstone investors but copartners, as they saw it. They wanted clear rules about how and where their funds were disbursed, with the ability to walk away. They didn’t want to come across as “dumb money”—precisely the impression created a year later when Masa boasted to a Bloomberg interviewer that he had raised $45 billion in forty-five minutes. p265

• Ahead of his meeting with the president-elect, Masa was prepped by Adelson and Steve Schwarzman, the private equity billionaire and boss of Blackstone. Both counseled him to emphasize that SoftBank was investing in America, playing to Trump’s vanity. Masa listened carefully. Then, armed with an iPad and his ever-present magic pen, he took a seat in Trump’s private office on the fifty-third floor of Trump Tower.

  “Here is my positive vision for your administration,” he said. “I am promising fifty thousand jobs with $50 billion of investment in the US.”14

  The words “Sprint” and “T-Mobile” never crossed Masa’s lips, though he did make a reference to being let down by the Obama administration. He then outlined a multimillion-dollar commitment to the US made by Foxconn, the electronics company based in Taiwan. Foxconn had made a fortune manufacturing the Apple iPhone and happened to be a longtime business partner of SoftBank, Masa explained.

  Trump grew visibly excited. “This is so good, we should tweet this. Do you think we should tweet this? Absolutely!”

  Reince Priebus, Trump’s incoming White House chief of staff, said maybe it would be a good idea to do some due diligence. Like which state the factory would be in.

  “Put the factory in any state,” Trump replied.

  Masa barely got past the first page of his slide deck. Trump was already tweeting out the good news in real time. p268

25. Crazy Guy

• “In a fight, who wins—the smart guy or the crazy guy?” he said, staring straight at Neumann.

  “Crazy guy,” said Neumann.

  “You are correct,” said Masa, “but you are not crazy enough.” p273

• “When leverage works, it magnifies your gains. Your spouse thinks you’re clever, and your neighbors get envious. But leverage is addictive. Once having profited from its wonders, very few people retreat to more conservative practices.” — Warren Buffett p274

27. The Great Escape

• The reason Berkshire traded at a premium was not that its structures were exemplary but that investors trusted the octogenarian Buffett and his nonagenarian partner Charlie Munger, who steered well clear of leverage. As Buffett said: “If you’re smart, you don’t need it; and if you’re dumb, you shouldn’t be using it.” p297

28. The Whale is Still Hungry

• SoftBank’s new trading strategy placed the company in the same camp as any large, beat-the-benchmark asset managers. This was a world away from inspired Alibaba-style bets or building businesses that had made Masa rich and famous. p311

29. Blizzard

• Masa took personal responsibility for the giant losses. He’d done the same all his life, refusing to blame others for his misfortune. p325

Epilogue

• “What a shitty life!” he exclaimed. “You know, on my Zoom call, I see my face often on the video screen, and I hate looking at my face. What an ugly face. I’m just getting old. And maybe I’m finishing my life as an entrepreneur in the next limited number of years, but what have I achieved? What have I done? This is just a mediocre, shitty life. I have done nothing that I can be proud of.” p327

• Masa was always in a hurry, throwing money at tech-enabled companies rather than “Deep AI.” Most galling of all, says one longtime collaborator, Masa would have been perfectly placed in 2022–23 had he conserved his firepower rather than splurging money on more than five hundred separate companies in the Vision Fund 1 and 2 portfolios. With company valuations beaten down by higher interest rates, Masa could have acquired stakes in promising AI-related businesses at bargain prices. p328

• Toward the end of a two-hour conversation, I ask Masa how he would like to be remembered, bearing in mind that he has no intention of retiring anytime soon. A long silence ensues, perhaps as long as fifteen seconds, as SoftBank’s founder and boss digests the question.

  “One of the foundation stones of AGI. I may not be the full story of AGI, but one of the foundation stones of AGI,” he says. “AGI is the only thing I care about. The only word I care about, those three letters AGI. And then it’s going to be ASI [superintelligence].”

  The answer is something of a letdown coming from a man who puts himself in the same category as empire builders like Napoleon or Genghis Khan. But Masa is apparently satisfied that making a lasting contribution to the AI revolution will be a fitting legacy. “I will pass away with a good smile.” p332

• If hubris brought him tumbling down, not once, not twice, but three times, he never gave up. p334

• There is an old Wall Street adage—you make big money off a small base or small money off a big base. Masa tried to rewrite the script. He tried to make gargantuan returns off a gargantuan base. p334