Why SoftBank doesn't like India anymore?

Softbank recently took a $40 billion loan — its largest-ever dollar borrowing — to increase its stake in OpenAI. At the same time, it hasn't made a single new investment in India in the last three years, and has been rapidly exiting its existing positions. In just six months, Softbank has cashed out of Ola Electric, Lenskart, InMobi, Policybazaar, and Flipkart. So what does this dramatic contrast tell us about the Indian startup ecosystem? In this video, we break down Softbank's full India journey — from its early days of aggressive, billion-dollar bets, to a decade of disappointments that has pushed the world's largest tech-focused VC fund out of the country entirely. Softbank's India Dream Around 2014-15, India was being called the "next big thing." Masayoshi Son was personally bullish, famously saying that one could "close their eyes and still make a great investment" in India. Softbank identified market leaders across categories and wrote enormous cheques — Snapdeal in e-commerce, OYO in hospitality, Paytm in fintech, and Ola in ride-hailing — hoping to replicate its legendary Alibaba success. What Went Wrong Out of a total $14 billion invested in India, Softbank has recovered only around $7.4 billion. Here's a quick breakdown of the major losses: Snapdeal – Failed against Amazon and Flipkart due to a weak logistics ecosystem that couldn't support an asset-light marketplace model. Ola Cabs – Lost nearly $1.4 billion as Uber and Rapido outperformed on execution. Ola Electric – Invested ~$450 million; the stock has collapsed with little hope of recovery. OYO – Valuation crashed from $10 billion to ~$2.4 billion, resulting in roughly a 50% loss on Softbank's $2 billion investment. Paytm – Regulatory troubles, governance issues, and a disastrous IPO led to a $500 million loss on a $1.6 billion bet. Three Core Reasons for Failure 1. India's market depth is overstated. The real paying consumer base for tech startups is roughly 15–20 million people, not the hundreds of millions many reports project. No Indian startup has crossed $100 billion in valuation. 2. Startup misgovernance. Many founders treated Softbank as an ATM — prioritizing secondary sales and inflated salaries over building sustainable businesses. Revenue fraud and governance failures damaged the credibility of the entire ecosystem. 3. India isn't competitive in AI. While Indian startups work on applications, American companies like OpenAI are building foundational infrastructure. Masa sees OpenAI as the "electricity grid of the AI era" — a once-in-a-generation infrastructure bet that India simply can't match right now. The Takeaway India needs stronger governance, greater transparency, and startups that solve global deep-tech problems — not just local versions of existing ideas — if it wants to attract serious capital again.