THE GIST
Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we’ll show you why it’s our #1 pick. Tap here.
Just as OpenAI stealthily files for an IPO, SoftBank, one of its biggest backers, got turned down for a $6 billion loan against its stake. Masa Son has spent decades treating valuations as a performance art form, and for the first time since he went triple YOLO on WeWork, the audience isn’t clapping.
WHAT HAPPENED
OpenAI filed confidentially for a U.S. IPO on Monday and is working with Goldman Sachs and Morgan Stanley on a potential listing as soon as this fall.
Meanwhile, creditors are getting cagey about handing its biggest backer a $6 billion margin loan against its stake in the company. SoftBank’s talks with potential lenders have stalled out.
And no, this isn’t listing-related. Lenders had already flagged concerns about putting a number on OpenAI while it stays private, concerns that pushed SoftBank to shrink the loan target in the first place. Some creditors reportedly pointed to missed internal sales and user milestones, too.
Margin loans backed by illiquid private stakes are a notoriously tricky thing to price. Lenders have to estimate what the collateral is worth under stress, and they want to know how fast they can get their money back if things go sideways. When the collateral is “whatever Masa says OpenAI is worth this quarter,” that math gets uncomfortable.
Investors aren’t convinced either. The stock slid 9% on Wednesday.
One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here.
WHY IT MATTERS
The stalled loan exposes the structural problem with using a private AI company as collateral, and it raises real questions about SoftBank’s liquidity heading into next year.
The context makes it sting more. Investors were already anxious about SoftBank’s commitments of more than $60 billion to OpenAI. To fund that conviction, SoftBank took out its largest-ever dollar loan, roughly $40 billion, on top of a $30 billion investment last year that took its stake to 11%. This is the company where money has always been more of a theoretical concept than a constraint, and the man who sold the golden goose, his entire Nvidia stake, to keep feeding this exact bet.
That concentration had credit watchers fidgeting for months. S&P Global lowered SoftBank’s credit outlook, warning that its swelling OpenAI exposure could strain liquidity and erode the quality of assets backing its debt. And… that’s exactly what’s happening. The performance artist finally met a crowd that wanted to see the receipts.