As its sale of Arm collapses, the tide is turning against SoftBank

FEW COMPANIESVCVC are more emblematic of the tech-obsessed, easy-money era of the early 21st century than SoftBank, the Japanese investment conglomerate founded and run by Son Masayoshi, or Masa for short. Starting life as an obscure Japanese software distributor in 1981, it has made one debt-fuelled bet after another to become an internet firm, a telecommunications giant, and then what Mr Son last year called the world’s , comfortably ahead of Tiger Global, a New York hedge fund, and Sequoia Capital, a powerhouse. Parts of its balance-sheet are opaque yet it continues to borrow heavily and is one of the world’s most-indebted non-financial firms. Like many of the Silicon Valley firms it invests in, it has a dominant founding shareholder who is not averse to spouting gobbledygook. Mr Son says he invests with a 300-year horizon, making SoftBank as close to immortal as financial firms get. But it is the here and now that he should be most concerned with.That is because the tech boom, which SoftBank has both fuelled and benefited from, may be . In the face of the highest rates of inflation in decades, central banks have started to . That threatens to tighten credit markets for highly leveraged entities like SoftBank. More important, higher rates make a big difference to the long-term value of the sort of high-growth tech startups it invests in, whose profits are in the distant future. As one of the highest rollers in two of the business megatrends of the past few decades, it is worth asking what would happen if tech fandom and easy money . As Warren Buffett once said, it’s only when the tide goes out that you can see who is swimming naked. What, Schumpeter wonders, is the state of Mr Son’s bathing attire?