Softbank Vision Fund About To Make Its First Investment Into WeWork

WeWork looks likely to be the first beneficiary of SoftBank’s $100 billion tech mega-fund, plus Nested, Tandem, funding news.

We first reported that a deal was likely in late February and so it has come to pass. WeWork has already received an injection of $300 million from SoftBank, but is likely to raise another $2.7 billion from the Softbank Vision Fund, which would push the co-working space provider’s valuation above $18bn.

The Vision Fund is comprised of a $25 billion investment from Softbank, with Saudi Arabi putting in $45 billion, the Abu Dhabi based Mubadala Development Co. stumping up $15 billion, and other contributors, including Apple, Qualcomm, and Oracle Chief Larry Ellison, providing around $1 billion each, it is rumoured.

Although the fund is large, it is not as large as Softbank’s alleged debt pile, which currently stands at $130 billion.

That should give most founders a sense of perspective when it comes to discussing cash burn and rising debt levels with investors – borrow big or go home, perhaps?

Neither Wework nor Softbank have commented on the deal thus far.

Another Proptech raise!

Nested, a London startup that guarantees to sell your home within 90 days, has raised an £8m pound Venture round just 6 months after raising a £1.2m seed.

Passion capital have led the round alongside Balderton Capital, joining existing investors Global Founders Capital, the VC arm of Rocket Internet, who helped fund the seed round alongside Passion.

Nested co-founder Matt Robinson is the man behind GoCardless, so it’s no surprise to hear that Nested are making big promises. The property platform guarantees to sell your home within 90 days, and if they can’t, they will offer you the cash themselves – which demonstrates how confident they are in their own price calculation algorithms.

Nested deals with customers Robinson refers to as “Charlie Chain”, and “Tired Tom”, people looking to make a quick sale or sick of keeping their property open for viewings but not getting results.

The company say that they broke even in their fourth month of trading with an annual run-rate of more than £1 million, and believe that they can achieve possibly as many as 1,000  or even 10,000 property sales per month.

Bullish – but it’s good to see founders with faith in their model.

Bad News For Fintech Challenger Bank Tandem

Here at HHH we’ve been following the fortunes of the 4 major challenger banks, Starling, Atom, Tandem and Monzo, and we’re sad to report on a setback for Tandem.

House of Fraser were due to invest £29m into the Fintech firm but have now decided to pull the deal, although it will remain a minority shareholder thanks to a previous £6m investment.

Tandem say that despite the blow the mobile bank will go ahead with plans to offer savings accounts to its customers in the near future, and release a credit card, subject to regulatory approval.

It may not be quite so straightforward however – City AM has been reporting that Tandem have failed to meet certain requirements that may well put its banking licence in jeopardy, and Business Insider says that the firm are having to make redundancies to reduce a cash burn rate that is threatening become overwhelming.

Tandem are blaming the absence of new funding from House of Fraser on limitations applied to Chinese companies investing money abroad by their government – HOF is now owned by Chinese firm Sanpower, and according to a post on Tandem’s blog, the deal is not completing “due to the increasing limitations placed on Chinese firms investing money abroad.”

“We will add saving accounts and current accounts back into the range of services we provide as soon as we feel the time is right for our customers and our business. Our determination to reduce the stress people feel in managing their money is as strong today as it has ever been,”

the post continues. Despite the setback, it’s all positivity from Tandem – this fascinating race to be Britain’s top challenger bank has a few stages to run yet.

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