Softbank Group, a Japanese multinational conglomerate holding company, has decided to lay off at least 175 workers of its robotics and artificial intelligence startup CloudMinds in China. The said corporate decision was due to the conglomerate's decision to have a cooler investment reception in the US.
CloudMinds has been losing money which led the company to slash out 175 to 225 people from its 700 workforces in China, reported Reuters. The said move was to support Softbank, the backer of the cloud robotics and artificial intelligence startup CloudMinds. The said conglomerate had revealed that it has had its eyes on joining the US stock market.
It was also revealed that CloudMinds had been losing money given that it is the latest Softbank portfolio company. The layoff was said to drive more investor confidence into the conglomerate. The bulk of the company's workforce was said to be in China, the country where the Japanese company generates most of its revenues.
The sources that revealed the information reportedly refused to make them known, as the said information was not identified as for 'public knowledge.' Furthermore, CloudMinds also did not comment on the issue including Softbank.
The results of the layoff were reported to generate a mere nominal presence in the US and Japan. It was also revealed that the Silicon Valley branch would also be closed while a small number of its staff would be relocated to the company's office in Irvine, California.
It was also discussed that Softbank's financial portfolio had been under scrutiny after investors questioned the company's CEO, Masayoshi Son. The allegations were centered on the company's rapid growth in the industry for intelligence, cloud-connected robots. Nevertheless, investors were said to be welcoming during road shows last summer. Those who were unfamiliar with the company and oblivious to its business model were also receptive to the company's growth.
The report further revealed that since the scrutiny, investors had been unsure of investing in CloudMInds, the sources claimed. They said that even another portfolio company of Softbank, office-sharing firm WeWork, was also starting to be under scrutiny for the same issues.
In other news, British banking firm Monzo has been in talks with SoftBank for financial assistance. The report claimed that Monzo has been eyeing the company's growth plans into the US. Monzo co-founder Tom Blomfield was said to have been under negotiations with senior officials of SoftBank's Vision Fund, reported The Telegraph.
It was said that Monzo plans to raise about 130.6 million USD in new funding for SoftBank. Furthermore, the bank was reported to have raised about 148 million USD in June from the US fund Y Combinator Continuity. The said move put the firm's value significantly higher in its early evaluation with an excess of two billion euros.
