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Chinese AI Unicorn Eyes IPO, Southeast Asia Expansion After $200 Million Funding Round

After a recent $200 million funding round from top Chinese venture capital firms, Shenzhen-based AI startup SmartMore has big plans to go public and expand across Southeast Asia, starting with Singapore.

The funding round, closed in June, included existing investors Sequoia Capital China, Lenovo Capital and Forbes Midas listee Anna Fang’s ZhenFund. IDG Capital, CoStone Capital and Green Pine Capital Partners also participated in the round. The two-year-old startup is now valued at more than $1 billion, says Li Ruiyu, cofounder and head of product, in a video interview.

“This round of funding will be used to penetrate deeper into our market, increase investment in R&D, and drive large-scale implementation of our intelligent manufacturing solutions,” says Li, 28, who made the 30 Under 30 Asia list this year. In October last year, SmartMore raised $100 million.

Founded in 2019, SmartMore specializes in computer vision technology. Using deep learning models and digital images from cameras and videos, computer vision technology can accurately identify and classify objects. The startup currently focuses on intelligent manufacturing and video-enhancement services.

SmartMore’s intelligent manufacturing technology helps detect malfunction at manufacturing lines. Unmanned AI inspection for automobiles and semiconductors, for example, can shorten the inspection process and increase production efficiency. A system trained to inspect products can analyze thousands of products in a minute and notice defects that are imperceptible to the human eye.

SmartMore says its clients include consumer goods companies Unilever and Procter & Gamble, European plane maker Airbus, German car-parts maker Continental and Japanese camera maker Cannon.

The startup’s video-enhancement technology uses AI to help enhance image and video quality in entertainment, mobile games, and video conferences. For example, SmartMore helped Hong Kong production company Media Asia restore old footage of TV shows and music videos. 

According to a report by Deloitte, the market size of AI in the manufacturing sector in China is expected to exceed $2 billion by 2025 from $365 million this year, due to favorable government policies, abundant investment capital and China’s huge manufacturing industry.

Besides Shenzhen, the startup also has offices in Beijing, Chongqing, Hangzhou, Shanghai, and Suzhou in mainland China, as well as in Hong Kong.

Last November, SmartMore made its first foray abroad with an outpost in Tokyo. “In Japan, there are a lot of high-precision manufacturers, which we cannot find in China,” he explains. “Through our colleagues in Japan, we found Japanese partners that could help us manufacture the materials we needed.”

And this month, SmartMore plans to launch in Singapore, which has been positioning itself as an AI hub, as part of an expansion across the Southeast Asia region. In 2019, Singapore’s Smart Nation and Digital Government Office announced plans to establish itself as a global hub for developing, test-bedding, deploying, and scaling AI solutions. “The country’s economic and financial policies have ensured the normal process of business activities, and funds can be allocated rationally, making Singapore one of the most successful countries in the world,” says Li.

The startup also has plans to go public, though Li notes that SmartMore does not have an exact timeline yet. One of China’s largest AI companies, SenseTime, is planning to file for an IPO in Hong Kong by the end of the month, according to a Reuters report on Thursday.

Apart from Li, SmartMore is cofounded by Chairman Jia Jiaya, a tenured computer science and engineering professor at the Chinese University of Hong Kong, CEO Shen Xiaoyong, CTO Lu Jiangbo, and technical head Liu Shu. All of the cofounders are armed with a Ph.D. in computer vision, computer science or electrical engineering.

Li, Liu and Shen were Jia’s Ph.D. students, and the three followed Jia to work at Tencent after graduating from their Ph.D. program before cofounding SmartMore together.

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