"The world's smartest investor" was deceived by a young man.
Author | Huo Yun
Source | Investor (ID: touzijias)
"The world's smartest investor" was deceived by a young man.
Just now, there was strong news from across the ocean, SoftBank founder Masayoshi Son sued the former favorite star company, social unicorn IRL, and the United States Securities and Exchange Commission (SEC) accepted the case. IRL was founded in Silicon Valley in 2017 by Abraham Shafi, the "No. 1 inspirational youth in the Middle East", with the dream of "subverting the way human beings socialize", and IRL has been known as the "WeChat of the West".
Listening to the future story of "Western WeChat", world-renowned VC/PE and industrial capital, including Warner Bros., Lionsgate, Dragoneer, and Founders Fund, have participated in the investment. Of course, the most famous battle is the Series C financing led by Masayoshi Son's SoftBank Vision No. 2 Fund in 2021, which made IRL worth US$1.17 billion (about 8.3 billion yuan) after the investment.
However, only two years after getting the C round of financing, "Western WeChat" broke up, and 95% of the platform's data was brushed out by machines. Immediately afterward, IRL announced its collapse, its founder, Abraham Shafi, stepped down from his position, and hundreds of millions of dollars in financing were missing. At the time of the collapse of IRL, Masayoshi Son was still defending the "No. 1 inspirational youth in the Middle East", believing that it was the global "black swan" that led to investment mistakes.
It took another year for Son to come to his senses, and he had already fallen into a shocking deception to make Abraham Shafi pay a terrible price.
One
The United States has not seen an Internet scam specializing in harvesting well-known dollar VC/PE and industrial tycoons for several years.
This scam can be described as shocking, winning the "world's most storytelling investor" Masayoshi Son in one fell swoop, and by the way, several VC/PE of United States entrepreneurs who are very good at "brainwashing" entrepreneurs overturned together. If it weren't for these self-proclaimed "smart" investors, IRL would not have obtained a valuation of $1.17 billion and drawn a "Western WeChat" pie without almost complete data fraud.
"Internet celebrity brother" Dong Yuhui often said, "When you are staring at the abyss, the abyss is also staring at you." No, a group of "smart" investors and dollar capital around the world have been "stared at". This is also Son's first anger, even if the investment fails and SoftBank loses into the mud, he has never been angry. IRL is different, cheated money, cheated feelings, and destroyed Son's dreams.
Missing WeChat is the regret of Son's Internet investment. He has talked more than once in public, "Caught the e-commerce and missed the social." Ever since he had regrets, Son has been trying to make up for them, basically running through the investment strategy of the $100 billion SoftBank Vision Fund, "as far as possible on a global scale, investing in the largest platform in various fields in five years." ”
Following Son's "largest" route, SoftBank Vision Fund has successively invested in DoorDash, the largest online food order demand aggregator in United States, Coupang, the largest e-commerce company in Korea, Grab Holdings, the largest travel platform in Southeast Asia, and Paytm, the largest payment platform in India. But for Son Zhengyi, what he is still thinking about is to make up for his social regrets and vote for "the next WeChat".
It is the dream of investing in the "next WeChat" every day that makes the "world's smartest investor" lose his mind.
A period of Son Masayoshi's unbearable past has written the legendary road of "the first big fool in the Middle East".
In the past few years, Abraham Shafi has been labeled as "God-level", he has been called "the No. 1 inspirational youth in the Middle East", "to bring a new era of social shock to the world", "Zuckerberg's future terminator", and "Son's favorite youth".
Following the growth trajectory of Abraham Shafi, let's first explore the legend of "the first big fool in the Middle East".
In his early years, in order to escape the war, Abraham Shafi moved to United States with his father, determined to "change the face of the Middle East". During his time at UC Berkeley, Abraham Shafi was not a quiet student, he had strange thoughts, always felt that "United States elite culture is brainwashing young people", he pursued "equality of all beings", and "built the wealth of the rich on the basis of the poor".
Halfway through his studies, Abraham Shafi dropped out of school and teamed up with a friend to start a recruitment website that "introduces ordinary people to good jobs". But it is said that the job site was suppressed by his local peers, and he was forced to sell the company to earn his first pot of gold.
One night in 2017, Abraham Shafi woke up in his sleep and fell into deep thought, he thought of the faces of his local counterparts in the Middle East and United States, and he vowed to inspire and turn everything around, win in United States, and help the people of the Middle East and the world realize the "right to speak".
A grand social blueprint was formed in his mind, and Abraham Shafi took the time to look through the "inspirational (painting cake)" books of various bigwigs, and he told the story of "subverting the way human socializes", inviting the invincible United States giants and capital to "enter the urn".
Two
IRL is the full name, "in real life" means "in real life".
In Abraham Shafi's view, "most of the information on the current social platforms is false. IRL is all about making the world feel like it's a real social experience. In IRL's worldview, "People are honest with each other, they can speak their hearts, and they have the right to speak." ”
In 2017, Abraham Shafi founded IRL in Silicon Valley, which was founded under the nose of Facebook founder Mark Zuckerberg. To focus on visibility, Abraham Shafi is always surprising, saying, "We're building groups and campaigns for a generation that doesn't use Facebook." From time to time, Zuckerberg is "benchmarked", and young people from the Middle East have received a high degree of attention.
In the United States, there are always media outlets that hype Abraham Shafi as "Zuckerberg's future terminator." Abraham Shafi is also a "ruthless person", other entrepreneurs want to raise funds as soon as possible when they open a company, he is not in a hurry, and uses the first pot of gold to sell the recruitment website, and makes every effort to package himself, "draw cakes", and create a "seamless" social PPT.
After two years of lying on the salary, Abraham Shafi bought a large number of machines, brought in "actors", and prepared to stage the "Oscars of the Middle East". The first "into the urn" is Warner Bros., one of the world's largest film and television entertainment producers, Lionsgate, the United States entertainment overlord, etc., who spent $8 million to participate in IRL's Series A financing, which is the world's most "acting" companies, the first time to be an audience, they are deeply immersed in Abraham Shafi's performance and cannot extricate themselves, United States owes him an Oscar.
In 2020, the global "black swan" suddenly struck, and people reduced going out to stimulate the second outbreak of the Internet outlet, IRL took advantage of the situation to tell the story of live streaming, online shopping, games, and AI to the outside world, and announced the data that the number of users increased by 400%, with 20 million active users and 12 million monthly active users (MAU). In 2020, Facebook had 2.8 billion monthly active users, a year-on-year increase of 12%; The combined monthly active users of WeChat and WeChat were 1.225 billion, a year-on-year increase of 5.2%.
However, global VC/PE investment depends on the trend and growth rate, and the 400% increase in IRL is a bargaining chip in the game with capital. Also in 2020, Abraham Shafi went United States major venues to "lobby", and he told United States people that the target of IRL was "Western WeChat". Abraham Shafi's "lobbying" was very effective, and in the same year, he received $16 million in Series B financing, doubling his valuation.
After the B round of financing, IRL has become the "Western WeChat" "recognized" by US dollar capital. The news spread to Abraham Shafi's hometown of the Middle East, where he was regarded by the media as the "No. 1 inspirational youth in the Middle East", and the Middle Eastern royal family "praised" him. One of the LPs of SoftBank's Vision Fund has Middle Eastern royalty, so Son had to talk to Abraham Shafi to see how powerful young people in the Middle East are.
Three
There is no doubt that Son fell for "regret (dream)".
"He (Abraham Shafi) will not vote".
According to media reports, at that time, there was a debate in the investment department of SoftBank Vision Fund about whether to invest in IRL, and some management felt that "IRL's next WeChat statement is not valid, and the founders are too passionate." But Mr. Son rejected the proposal, arguing that "the vision was right." In past investment cases, Son judged the prospects of a company in just over 10 minutes.
For example, he once communicated with Jack Ma, the founder of Alibaba, and said that he would invest immediately. When I met the founder of Yahoo, I said that I would invest as much as I wanted, and the success of Alibaba and Yahoo made Masayoshi Son "the smartest investor in the world". Therefore, the investment department of SoftBank Vision Fund did not dare to argue with Son again, after all, no one can predict whether IRL is the "next WeChat".
If so, I didn't vote for "next WeChat". Dissenters will be labeled "the first fool in the global investment community". Son Zhengyi couldn't wait, he voted, and he also sold the face of the Middle Eastern royal family behind the "gold father", and strongly supported the "No. 1 inspirational youth in the Middle East".
In 2021, SoftBank Vision No. 2 Fund pulled world-renowned VC/PE companies such as Dragoneer and Founders Fund, which "do not trade at a loss", into the game. Among them, SoftBank Vision No. 2 Fund led the investment of 170 million US dollars, and other institutions invested tens of millions of US dollars. Masayoshi Son joined the board of directors, activating IRL's post-investment valuation of $1.17 billion, and Abraham Shafi entered the list of the richest people in the Middle East.
But in 2022, IRL, which should have been at the top, did an unbelievable thing and laid off employees. They fired "a handful of employees," and the observant United States media sensed something was wrong and decided to appeal to the United States authorities to investigate what kind of company IRL was. As a result, the relevant departments investigated, "This is a shocking scam designed to fool investors."
Abraham Shafi stepped down from his post, and hundreds of millions of dollars in financing were missing. According to the investigation results of relevant departments, 95% of IRL's data is swiped out by machines, APP downloads are also bought, IRL uses money to carry out all kinds of fraud, Abraham Shafi and his fiancée use IRL's credit card for personal consumption, executives are invited "actors", the company is just an empty shell, and the rest are scammers.
Knowing that the "Western WeChat" was a scam, at first, Son did not believe it, believing that it was the chain effect brought about by the global "black swan". After all, under the influence of the Fed's aggressive policy, the valuation of companies holding US dollars around the world has shrunk, causing SoftBank and SoftBank Vision Fund to suffer a big loss, and once pulled Son off the altar. He felt that the fault was not Abraham Shafi, but the cauldron of the environment.
In 2023, before the scam was confirmed, IRL broke up and the company collapsed, and Son changed his attitude. Because, SoftBank Vision Fund negotiated with IRL and wanted to get back the $170 million in financing, tossing for a year, to no avail, and then no one was found, and in anger, Son Masayoshi sued IRL and Abraham Shafi, asking for a painful price for "the first fool in the Middle East".
It can be seen that Son is really angry. Even though SoftBank's performance in the past few years was very bad, he was not in a hurry, and even bowed and apologized to shareholders. The reason for his anger is that he has invested emotions, money, and dreams. The point is, there is no word for "fooled" in his dictionary. It was rumored that Jia Yueting went to the United States to do FF in United States to find Sun Zhengyi financing, but he did not agree, and he saw at a glance that it was "unreliable". It can only be said that investment is sometimes a "gamble", whether you win or lose, it depends on a little luck. Hopefully, the fall of IRL will be a wake-up call for VC/PE to "listen to fewer stories".
No matter what the road ahead is, in the hearts of the people of the Middle East, Abraham Shafi is already a "legend".