No Japanese CEO has more swagger than SoftBank’s Masayoshi Son. Through splashy acquisitions and serial risk-taking, he morphed a staid telecom operation into a global disruption machine.

The US$100 billion Vision Fund that Son rolled out in 2017 made him the most sought-after meeting for the Silicon Valley set. In short order, Son remade the venture-capital game.

He also shook up the tech valuation environment by pumping giant waves of liquidity into chipmakers, robots, software, satellites, renewable energy, indoor farms, asset management and ride-sharing names Uber, Didi Chuxing, Grab and Ola.

This made Son a godsend for cash-deprived startups, but also a one-man bubble-blower to many investors. Now, tech valuations are hoping for fresh support as Son rolls out Vision Fund 2.

The early signs, though, offer plenty of reason to fear Son’s next $100 billion of firepower could go awry. Case in point: Son is not only leveraging his own, in-house war chest, he is leaning on his employees for cash.

Snake eats own tail?

Son, as first reported by The Wall Street Journal, wants to lend as much as $20 billion to SoftBank staff so they can take stakes in Vision Fund 2.

Son’s employees would borrow a wad of cash from SoftBank Group. That cash would then be piled directly into Vision Fund 2. The loan would come with a 5% interest rate, and depending on individual circumstances, some staffers might put some of their own money down.

Son’s best-case scenario would be for each of SoftBank’s nearly 75,000 employees to borrow an average of US$266,000. An interesting idea, of course. The optimists view: by having serious “skin in the game,” employees will have greater incentives to succeed.

Yet, this circular-looking investment move appears to signal that Son is confronting funding gaps.

The initial Vision Fund was largely Saudi-funded. This time, Son is hitting up Kazakhstan for roughly US$3 billion. Son is getting investments from Goldman Sachs, Standard Chartered, Mitsubishi UFJ Financial and others.

Generally, though, reports have such companies pledging hundreds of millions of dollars each – not billions. He’s also chatting up insurers and pension funds.

Son’s target is to raise $108 billion in all. How does it break down?

Well, half of it comes from in-house. SoftBank itself is kicking in US$38 billion. Then comes the call on employees. Assuming SoftBank staffers answer the call, in-house money would provide, all in, a whopping 54% of the target – and take on 54% of the risk should losses pile up, of course.

There’s a slightly desperate look to all this.

It reminds Claudia Zeisberger, who lectures on entrepreneurship at INSEAD’s Singapore campus, of failed hedge fund Long-Term Capital Management in the 1990s. Before it blew up in 1998, she notes, LTCM “partners returned money to investors, whilst profitable, to gain more exposure themselves to their investment” – or “drinking their own Kool-Aid,” as Zeisberger sees it.

Son, one can hope, isn’t repeating that mistake.

Show me the confidence

But that could be a vain hope, for since July 27, the day Son announced the details of Vision Fund 2, the absence of a key Saudi-like investor ponying up close to $50 billion was impossible to miss.

It’s grand, for example, that Apple, Foxconn Technology and Microsoft are chipping in. But firm dollar amounts have been hard to come by. That seems code for these names placing modest bets.

All this raises questions about Son’s strategy – and the wider fund-raising environment.

Vision Fund 1 had it easy, you might say. With a couple of big and committed cornerstone investors – the Saudis and Abu Dhabi’s Mubadala Investment Co – Son’s team had their pick of tech unicorns. They easily found ready targets in the US, Europe, India, Indonesia, Singapore and beyond.

Now, though, the global trade war, slowing growth and a less obvious roster of startups to target are challenging Son.

Consider all this a microcosm of where the world economy is heading in 2020. Increased market volatility and punters in a risk-off state of mind could have a chilling effect on the unicorn pipeline.

The about-face in global conditions these last 12 months also has investors wondering about Son. The benefit of the doubt that punters accorded Son’s initial Vision Fund owes much to his status as the “Warren Buffett of Japan.”

This reputation flows back to 2000, when Son bet $20 million on an obscure Chinese English teacher. By the time Jack Ma took Alibaba public in 2014, Son’s stake was worth $50 billion.

Since 2017, Son has pursued what might be called a “Moneyball” approach to investment – a reference to Michael Lewis’ 2003 book about baseball. He’s sprinkled a few hundred million dollars here, and a billion or two there, to recreate Buffett-like income streams in the aggregate.

But the outcome is still up in the air: investors will just have to wait to see how the many disparate pieces in which Son invested gel together in profitable ways.

Hence the pressure on Son to make Vision Fund 2 look like a hit out of the gate. It’s still entirely possible that he can. He can still cast a wider net and collect that $108 billion. But hitting up employees for cash doesn’t exude confidence, as these things go.