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Wednesday, 27 June, 2001, 12:40 GMT 13:40 UK
$600m man keeps the faith
This despairing man
Many investors have adopted this pose in recent weeks
By BBC News Online technology correspondent Mark Ward

You might expect Daniel Sasaki to be a little downcast.

Mr Sasaki manages a $600m venture capital fund for Softbank Europe and invests only in technology and net-based companies.

Our faith in the underlying prospects for the growth of the internet and all its associated technologies remains intact

Daniel Sasaki, Softbank
The crashing value of technology shares meant that the profits of Japanese parent Softbank were down 97% for the last six months of trading. Many other economic indicators imply that the technology industry as a whole is slumping.

But despite this news and the glut of dot commiseration over dot congratulations, Mr Sasaki's enthusiasm for technology companies and their long-term prospects remains undimmed.

High-tech hopes

In March 2000, technology stocks hit a heady high, but by the same month this year many of the same stocks had plunged in value.

The tech heavy Nasdaq index alone fell from a high of 4,500 points to under 2,000. This led many dot.coms to go bust as funds and the indulgence of investors evaporated.

But Daniel Sasaki, managing director of Softbank Europe, is sanguine about the long-term prospects for such firms.

"It's sensible to be concerned about the current climate," said Mr Sasaki. "But our faith in the underlying prospects for the growth of the internet and all its associated technologies remains intact."

Mr Sasaki is upbeat because he believes that many people have over-estimated how long it takes for the changes ushered in by net-based and novel technologies to make themselves felt.

A good deal of good deals

He said there was no doubt that such technologies could take costs out of doing business using net-based trading systems, but also by improving computer and communication networks with the latest technology.

One positive aspect of the downturn has been to change the types of companies that come knocking on Softbanks' door, said Mr Sasaki.

"Much of the opportunities are now driven by groundbreaking technologies rather than service possibilities made possible by the existence of the internet," he said.

The Softbank Europe fund was set up late last year and missed the European frenzy, a fact that is working to the advantage of the venture capital company.

"There's much higher quality deal flow," said Mr Sasaki. "Entrepreneurs now really believe in what they are doing. They are no longer the dilletante they might have been a year ago."

Now the problem is not a glut of badly thought out dot.coms, or even a dearth of companies developing new technologies, said Mr Sasaki. The hard work is figuring out which company has the best chance of making the most of its opportunity.

Its not a question of finding a technology that's new and that works," he said. "The hard work is in deciding if that really adds meaningful value somewhere in some food chain and if so how sustainable that value is and when is that value likely to be realised."

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See also:

16 Apr 01 | dot life
The art of failure
20 Apr 01 | UK
Through the wringer
14 Feb 01 | Business
Dot.coms sober up
30 Mar 01 | Business
Taking the web to work
10 May 01 | Business
Making money on the net
28 Mar 01 | Business fund fights for survival
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