Will it success this time?
The AI innovator Beijing Fourth Paradigm Technology, or 4Paradigm, filed a prospectus with the Hong Kong Stock Exchange again on February 23, 2022, 10 days after the first application lapsed due to the failure to pass the pre-listing hearing. Goldman Sachs Group and CICC were its joint sponsors.
Founded in September 2014, 4Paradigm is a pioneer and leader in decision-making enterprise AI industry. It offers platform-centric AI solutions and leverages core technologies to develop enterprise-class AI products.
4Paradigm’s AI solutions are now being deployed in almost every major industry in China, including but not limited to finance, retail, manufacturing, healthcare, energy and power, telecommunications and healthcare.
There are four main types of AI enterprises domestically. The first is the visual AI enterprises, whose key applications are face recognition and autonomous driving. SenseTime and Megvii are the two leaders.
The second type is the voice semantic AI enterprises represented by iFlyteck (002230:SH). 4Paradigm belongs to the third category which provides AI with reasoning, judgment and other decision-making capabilities.
The last type is the artificial intelligence robots that are designed to replace humans in certain repetitive or dangerous tasks, such as DJI (drones) and Siasun Robotics (industrial robots).
Information from Tianyacha, a business data and investigation platform, shows that since its inception, 4Paradigm has completed 12 rounds of financing, with investors including Sequoia China, Sinovation Ventures and other renowned venture funds. In January 2021, 4Paradigm announced the completion of its Series D funding round for USD 700 million.
Most of its senior management team once worked for China’s search engine giant Baidu (BIDU:NASDAQ) in core positions. For example, Dai Wenyuan, the founder and CEO of 4Paradigm, was the former Chief Architect for Baidu’s Phoenix Nest System, the major search service management platform.
4Paradigm’s road to an IPO was a rocky one. In fact, on 13 August 2021, the company filed its prospectus in Hong Kong for the first time. However, the status of 4Paradigm's IPO application was changed to "lapsed" on February 14, 2022, as it failed to pass the hearing within six months. It is still difficult to predict whether the second IPO application will be given the greenlight.
According to the prospectus, Dai held 106 million shares, or 24.25% of the company’s equity; Paradigm Management Consulting Partnership, an option pool, held 14.61% and Sequoia Capital China owned 7.37%.