Softbank Shifts Focus To Early Stage Companies, Renews Focus On New York Startups

Today, Softbank Capital is announcing a series of updates, including the launch of its redesigned website. Some of these changes have been brewing for some time now, but, hey, the redesign of its website is as good a time as any to spread the word. Over the past year and a half, Softbank has been in the process of shifting its investment strategy to one that focuses more heavily on early stage businesses. Rather than investing larger chunks in series B rounds, Softbank will be seeking to invest in seed and early series A rounds, in smaller doses, giving the firm the opportunity to invest in a greater number of companies.

What’s more, since launching its new fund (SoftBank Capital Fund 2010) at the end of 2009, the firm has been more aggressively investing pieces of its $100 million pool in New York City-based startups. Having invested early in New York media companies like Huffington Post and Buddy Media, and with offices downtown, the firm has been investing in New York since its inception, but in the last year especially, interest has been renewed. Softbank has made 22 investments in the U.S. in the last year and a half, ranging from $100,000 to $4 million, which have included startups like MocoSpace, Boxee, Cheezburger, OMGPOP, YouAreTV, betaworks,, and SocialFlow. Of these recent investments, 14 companies are based in New York.

Since 1995, Softbank has been investing in early stage, high growth technology businesses. The firm was originally an offshoot of SoftBank Corporation, a Japanese telecommunications and media company founded in 1981 (that, oh by the way, has a market capitalization of around $20 billion) — while Softbank’s venture wing, on the other hand, has a portfolio of companies that is primarily focused on the U.S.

Of course, while the firm’s investments have focused on the U.S., new Softbank Partner Joe Medved said that the firm has been influenced by the evolution of the mobile industry in Japan, and its explosion in Asian markets. As such, Softbank has paid particular attention to early-stage socially-driven mobile businesses. This is where Softbank can be a asset to startups and perhaps has a legup over other VC firms: With Softbank’s establihshed connections in Japan and Asian markets, mobile startups looking to take advantage of these rapidly growing international markets will have a head start.

As part of the activity of its new fund, Softbank promoted Joe Medved to partner, and Nikhil Kalghatgi is joining Softbank as a senior associate. Medved has been at Softbank since 2005 and has led investments in BestVendor, Ohanarama, Opionionaided, and YouAreTV, among others. Kalghatgi is a recent Harvard Business School grad, and a TechStars alum with Localytics.

Though it should not come as a surprise knowing the relationship between the two firms (thanks largely in part to Eric Hippeau), Softbank officially acknowledged its involvement in Lerer Venture’s recent raise of $25 million. While Softbank would not disclose the actual amount, Medved did say that it was a significant player in the investment.

Oh, and for those West Coast startups, Softbank has also opened a west coast office in Palo Alto, which will be run by the head of Softbank’s China & India Funds, Kabir Misra.

For more, check out the new site here.

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