Artificial intelligence company SenseTime is now ready to go public as it plans toward its Initial Public Offering.
SenseTime is one of the AI solution giants in China, and it is also considered the most valuable AI company in the world. SenseTime took a step further to its IPO as the company obtained regulatory approval. Now, the company will reportedly list on the Hong Kong Stock Exchange.
SenseTime Ready for IPO on Hong Kong Stock Exchange
When SenseTime was founded in 2014, the AI solution provider became the fourth “AI Dragon” in China. The other three were Software companies Megvii, CloudWalk, and Yitu. During the second half of the 2010s, there was a huge demand for AI solutions from businesses and governments. Governments adopted AI models to watch the streets 24 hours each day. Also, companies adopted AI-sensing solutions in predicting crowds in Malls premises.
The three SenseTime competitors will also begin selling shares in Mainland China and Hong Kong. Software company Megvii is about to list on China’s Nasdaq- style STAR board.
AI startups in China was an attraction to investors globally. SenseTime generated over $2 billion in investment in just 2018. Currently, the AI company has completed 12 successful financing rounds, raising about $5.2 billion. Some of its most prominent outside shareholders are SoftBank Vision Fund and Alibaba’s Taobao. Referring to sources, Reuters noted that SenseTime is looking forward to raising $2 billion in its IPO.
Between 2018 and 2020, SenseTime spent a huge percentage of its capital on research and development. The expenses on research and development were over 5 billion yuan, equaling $780 million. Also, net losses recorded over the past four years were due to “the fair value losses of our preferred shares.” In the first half of 12021, net losses were at 3.7 billion yuan. As of June, the total deficit was about 23 billion yuan.
SenseTime’s Revenue Largely From “Smart City” Projects
SenseTime generates money from its “smart city” projects, just like its rivals. According to the AI company’s prospectus, around 119 cities now use its software platform as of June. The smart city business makes up 47.6% of the company’s total revenue which was 1.65 billion yuan in the first six months of the year.
On the other hand, SenseTime derived 40%mof its revenues in the first six months of 2021 from its “Smart Business” line. The business focuses on commercial space, residential property, and other enterprise needs. Additionally, the AI solution provider sees a part of its revenue from its “Smart Life” unit, which supplies IoT devices. Lastly, the firm saw the rest of its revenue from “Smart Auto.” Smart Auto broke the world’s record in pedestrian and vehicle direction on one of the largest international autonomous driving databases, KITTI 2016.