Lee Kai-fu’s AI start-up plans IPO at value of over US$1 billion, most likely in China
- Lee figures AInnovation will be able to go public in less than two years at a valuation of US$1 billion to US$2 billion
The promise of artificial intelligence has yet to translate into big business.
Now Lee Kai-fu, a prominent venture capitalist in China and founder of Sinovation Ventures, says his firm’s new start-up should be able to reach US$100 million in revenue next year and go public the year after.
AInnovation, established in March 2018, develops artificial intelligence products for companies in industries such as retail, manufacturing, and finance. Its customers include Mars, Carlsberg, Nestle, Foxconn Technology Group, China Everbright Bank and Postal Savings Bank of China
Chief Executive Officer Hocking Xu, a veteran of International Business Machines Corp. and SAP, has hired staff that work with traditional companies to figure out how to take advantage of AI in their operations. AInnovation is on track to hit US$100 million in revenue within two years of its founding, the fastest pace yet for such a start-up, Lee said.
“We took the approach of ‘Let’s take some of the best businesspeople and let’s target the industries which need AI the most’,” he said.
Lee figures AInnovation will be able to go public in less than two years at a valuation of US$1 billion to US$2 billion. The firm has raised about US$70 million so far from Sinovation, CICC ALPHA and Chengwei Capital. Since the company was funded with yuan, it would most likely list domestically, either on China’s new NASDAQ-like Star market, or on the country’s ChiNext.
For retail companies, AInnovation sells products including a smart vending machine that opens with facial recognition and software that monitors retail shelves with image recognition. It has created computer vision technology that detects defects on the production line for manufacturers and underwriting software and natural language processing technology for financial firms.