Just weeks after the United States blacklisted a unit of SenseTime Group, the company is on the verge of making this man one of the richest people in the world.
Just weeks after the United States blacklisted a unit of SenseTime Group Inc. for alleged human rights violations, the company is on the verge of making its founder Tang Xiao’or one of the people. the richest in the world. China’s largest artificial intelligence company has priced its initial public offering at HK $ 3.85 (49 cents) per share. It was the low end of the expected range, but a signal that despite heightened tensions with the United States and Beijing’s crackdown on tech giants, the country, including its vast oversight mechanism, continues to generate huge fortunes and massive gains for venture capitalists.
Tang, 53, a graduate of the Massachusetts Institute of Technology and professor of information engineering at the Chinese University of Hong Kong, owns 21% of the company’s capital and is worth $ 3.4 billion, according to the index Bloomberg Billionaires.
A representative for SenseTime declined to comment on Tang’s net worth.
SenseTime has long been expected to be a successful public offering, but has drawn fire in recent years. He was forced to delay registration this month after the United States alleged the company’s facial recognition software was being used in the oppression of Uyghur Muslims in the western Xinjiang Autonomous Region. from China. SenseTime said the accusations, which led to the sanctions, are without merit.
SenseTime is the first overseas offering from a leading Chinese tech unicorn since the IPO of ride-hailing giant Didi Global Inc. in New York City in July sparked a regulatory backlash from authorities in Beijing . The shares are expected to start trading on December 30 in Hong Kong, giving the company a market value of more than $ 16 billion.
Tang has long been involved in the development of artificial intelligence required for facial recognition.
He received his undergraduate degree from China University of Science and Technology, then University of Rochester in New York, and received his doctorate from MIT in 1996, where he studied underwater robotics and computer vision.
He worked for Microsoft Research Asia for a few years and co-founded Shanghai-based SenseTime in 2014 with Xu Li, then a researcher at Chinese computer maker Lenovo Group Ltd. SoftBank Group Corp., Alibaba Group Holding Ltd. and Silver Lake.
It is now the largest AI software company in Asia with an 11% market share, according to the prospectus. The technology is being deployed in a variety of areas, including helping police in China, offering product placements in films, and creating an augmented reality scene in a mobile game from Tencent Holdings Ltd.
SenseTime relaunched its IPO process days after the blacklist with a group of key investors increasing their bets to $ 512 million from $ 450 million. These include the state-backed Joint Venture Reform Fund and the Shanghai Xuhui Capital Investment Co.
The company then uploaded a legal notice to the Hong Kong Stock Exchange, claiming the restrictions did not apply to the parent company of the sanctioned unit. While the size of the offering remained the same, retail investors were more cautious, with stocks 2.3 times oversubscribed, less than the previous subscription.
“It makes sense that retail investors looking for short-term gains have become less enthusiastic about the sanction factor,” said Kenny Ng, strategist at Everbright Sun Hung Kai. “Especially since the global Hong Kong stock market has not been doing well lately.”
SenseTime’s revenue grew 14% last year to 3.4 billion yuan ($ 534 million), although it still recorded an operating loss of 1.8 billion yuan .
“Early-stage technology companies still need to invest more in research and development to keep their technology competitive,” Ng said. “For SenseTime, maintaining stable revenue growth is more important than becoming profitable in the short term.”