Honor a health-care start-up to raise $150 million investment from SoftBank Vision Fund 2

on Dec 6, 2019
  • SoftBank has held talks to invest $150 million in home health-care start-up Honor which connects in-home caregivers via online tools.
  • Vision Fund investment committee hasn't approved the deal yet.
  • Vision Fund 2, which is still in fundraising mode and may raise up to $108 billion., with Honor being its potential first known investment

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Honor connects in-home caregivers, seniors, and their families via online tools.

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Its founder Seth Sternberg moved into the health space after selling Meebo, a messaging service he co-founded, to Google for $100 million reported in 2012.

Honor has received a wave of financing from investors looking to capitalize on an industry that hasn’t seen significant upgrades in technology.

Some companies like HomeHero stumbled, saying there was no magic in a venture capital-backed homecare.

According to LinkedIn, Honor has already raised more than $100 million in the capital and has more than 600 employees.

The company focuses on partnerships with existing, independently owned home care providers, including taking on more of their technical operations, such as caregiver onboarding and training tools.

SoftBank Vision Fund 2

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SoftBank’s Vision Fund has discussed investing $150 million in health-care company Honor.

The Vision Fund Investment committee hasn’t approved the Honor investment yet, but it marks one of the first known potential bets for the massive new fund.

Vision Fund 2 has several investments in the work, some already approved by the committee. Also, all the investments will remain private until the fund concludes its fundraising.

Masayoshi Son, SoftBank founder, and CEO told the Vision Fund partners scouting deals that he wanted to slow the pace of new investments. He wants to focus on companies that had a clear path to profitability for his second Vision Fund.

His decision followed the public market’s adverse reaction came from the money-losing investments from the first Vision Fund. Investments include WeWork and Uber. SoftBank has now acquired WeWork to stave off potential bankruptcy.

Last month, SoftBank reported its first quarterly loss of $8.9 billion in 14 years.

In July, SoftBank said it planned to raise $108 billion for Vision Fund 2 with investments from companies and sovereign wealth funds including, Foxconn, Apple, Microsoft, Corporation of National Bank of Kazakhstan, and significant participants from Taiwan.

Not all of the stated contributors are still planning on investing in Vision Fund 2, but SoftBank is still focused on raising about $100 billion or more for the fund.

“Fundraising is progressing as expected as investors assess potential commitments to Vision Fund 2,” said a Vision Fund spokesperson. The spokesperson declined to comment on the Honor acquisition specifically.

Other investors in Vision Fund 2 are likely to include Abu Dhabi state fund Mubadala and Saudi Arabia’s Public Investment Fund.

However, neither is expected to contribute as much as they did to SoftBank’s first Vision Fund.

Mubadala committed $15 billion, and Saudi’s PIF invested $45 billion to Vision Fund 1.

SoftBank is expected to be the largest equity investor in Vision Fund 2, just as it was in Vision Fund 1.

“Vision Fund 2 is going to be launched as scheduled,” Son said last month.

SoftBank’s Vision Fund 1, which raised $100 billion, is no longer committing capital to new deals but plans to use its remaining funds to follow-on-investments.

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