- Before a Valley startup named Cohesity landed a massive $250 million round of investment led by Softbank's Vision Fund, the founder had to pass muster with Masayoshi Son himself, Softbank's founder and one of the world's richest men.
- It was an unusual and whirlwind meeting at Son's California mansion, wedged into a six-hour layover.
- Cohesity CEO Mohit Aron and Softbank's senior managing partner Deep Nishar shared details of the meeting with Business Insider, and what it's like to be a startup working with the world-renown billionaire.
Earlier this month, a computer storage startup called Cohesity announced that it had raised a massive $250 million round of investment mostly from Softbank's Vision Fund.
In addition to the usual due diligence, Cohesity founder and CEO Mohit Aron tells Business Insider that he had to pass muster with Masayoshi Son himself, Softbank's founder and one of the world's richest and most prestigious business men.
"I was naïve," Aron said. "I know investors and the way they work, but I don’t know how Softbank worked."
Right when Aron thought he and Softbank had hammered out the details, he was told there was one final step involved: Son personally approves every deal. "They have $100 billion. How can he approve every deal? But they told me, 'We don't do that many deals. We are very picky'."
Son's $100 billion Softbank Vision Fund is earmarked for tech that Son thinks will be game-changing. As such it has mostly focused on the trendiest companies, pouring huge investments into companies like WeWork, Uber, Katerra.
It has also turned Softbank and its wealthy founder into one of the most powerful forces in Silicon Valley these days.
Cohesity doesn't seem like the typical Vision Fund investment because it offers far geekier technology, software and a cloud service that helps companies manage their large-scale computer storage backups.
But its true claim to fame is its founder, Mohit Aron, who was an early Google employee and one of the co-founders of another hugely successful enterprise tech company, Nutanix.
Aron has known senior managing partner for SoftBank's Vision Fund, Deep Nishar, for years. Nishar was also an early Google employee and a seed angel investor in both Nutanix and Cohesity, as well as a mentor to Aron, a first-time CEO.
When Aron decided to raise another round, he called his old friend Nishar, confident that the relationship would generate a term sheet.
And it did (after Cohesity passed the due diligence). But before the $250 million check was cut, which valued the five-year-old company at $1 billion, it had to be personally approved by Son himself. And Aron had to meet Son in person.
Guards as big as bouncers
Aron describes the meeting as nerve-wracking.
Aron didn't have to schlep to the tarmac. Son has a mansion in the exclusive Portola Valley and Aron was invited there.
"Me and my VP of finance, we parked our cars [on the street] and the gate surrounding the property was closed," Aron described.
"There was a security guard with a walkie talkie and a mike and headphone. He told us to wait on the road, all of us, even when Deep and his team arrived," he said.
When the gate opened, guards escorted them all into the house. "They look like bouncers. If things go wrong, they can throw me out," Aron thought as he walked beside them.
The house was gorgeous and tasteful, decorated in Japanese style, as you would expect from a man that founded one of Japan's biggest telecom and tech companies.
Everyone removed their shoes, as is the Japanese custom, and to Aron's surprise, Son "was at the door to receive us."
They bowed and shook hands and he followed Son into a conference room big enough to hold the visitors plus a handful of Son's staff.
Soft voice, big commitment
Son speaks in a soft voice. He apologized while politely warning Aron he had a 30-minute time limit.
Son merely listened.
The room seemed to know when he was ready to speak and everyone grew quiet.
In his soft voice, he asked Nishar questions about the terms of the deal, which Nishar explained including plans for expansion into Asia.
Then Aron's long-time friend added. "I believe in this team."
Masa grew quiet again. For 10 seconds, he tapped his fingers on the table, thinking deeply.
"I was on the edge of my seat," Aron said.
And then Son nodded. Aron had passed the test. Cohesity was closer to its $250 million cash infusion as well as the massive international resources that Softbank could bring.
"Masa and I shook hands again and he was nice enough to accompany us to the door and bowed again," Aron says. When he shook Aron's hand, he said, "Now, this is done, yes?"
It was a moment of partnership. He's a fellow founder who's been investing for 30 years. He wants to look the founders in the eyes. "He then gets comfortable," Nishar told Business Insider.
They put on their shoes, were escorted out the gate and off the property by the guards.
Nishar describes Son as "a very thoughtful person," adding, "He obviously trusts the team that does the work [on the deal] but he believes in a personal connection with all the founders."
Join the conversation about this story »
NOW WATCH: A company designed a wheelbarrow that loads from the ground
0 Comments