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Uber deal reflects SoftBank's growing power in Silicon Valley

SoftBank founder and CEO Masayoshi Son. Photo by Alessandro Di Ciommo/Getty

Early Uber investors Benchmark Capital and Menlo Ventures have said that they will sell a portion of their shares in the ride-hail giant to Japan's SoftBank Group via a well-publicized stock tender. There are no specifics on how many shares the firms might be willing to sell, nor is it certain that the deal will get done.

Bottom line: Do not underestimate how concerned VC firms are of crossing SoftBank. Not only has it become venture's largest and most aggressive player via its $98 billion Vision Fund, but it also has become a vital source of interim liquidity.