AI Unicorn 4Paradigm Completes Series C+ Financing Round
China's fintech AI unicorn company 4Paradigm's post-investment valuation is around USD 2 billion. New backers Cisco, CITIC Bank and others joined the team.
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Source – 4Paradigm(第四范式). The Chinese AI company 4Paradigm has announced Series C+ financing, which brings its Series C total funding to USD 230 million. We saw more corporate funds in the latest financing series. According to the company, the investment will contribute to advancing AI industry chain development as well as the China’s AI infrastructure.
Founded in 2014, 4Paradigm has completed six rounds of financing, backed by top-rank VCs like Sequoia and China's ‘Big Four Banks’ – ICBC, CCB, ABC and BOC. Given the heavy financial featured of 4Paradigm’s bank investors, fintech is a significant component among the company’s service matrix. As 4Paradigm presented on its website, most key clients reside in the financial sector. In the fintech vertical, 4Paradigm seems to have the highest penetration among all AI fintech peers.
As all AI companies are striving to survive the cold winter, with shrinking investment and critiques flying about the AI bubble, 4Paradigm is not in the eye of the storm, unlike the most valuable AI unicorn SenseTime (商汤科技) and the AI pioneer Megvii (旷视科技), which have filed for IPOs and reported great losses. Somehow, these rushing-to-the-front AI companies have erected an umbrella over the rest of the AI firms, protecting them from public attrition.
Apart from fintech, 4Paradigm also provides services for retail, healthcare, media and other sectors. For enterprises in these fields, the company provides products and services based on the knowledge map: precision marketing, antifraud, recommendation engine, etc. It now pitches to the public that its orientation is building an AI platform for enterprises and organizations in various industries.
4Paradigm was recognized for its rapid market expansion in research conducted by IDC in 2019. The growth of the company is real, but the AI bubble is also real. The manic phase of AI investment (2017-2018) has gone and left a bunch of AI companies with highly-floated valuation – a time bomb for all to suffer.
On the other side of the Pacific, someone is experiencing the agony of overinflated valuation: the famous AI company Palantir postponed its IPO plan and was seeking a financing round based on its latest valuation of around USD 26 billion, as reported last September. While two years ago, the company had been valued as high as USD 41 billion, which is USD 4 billion less than the current market cap of Uber (UBER:NYSE).
Plunging valuations caused a vexed IPO for the company, which is common for startups that are overvalued – as Softbank's Masa Son’s portfolio companies show. Unlike its peers struggling for monetizing products and services, 4Paradigm, so far is in good shape. However, the AI sector however, is not – and the bubble is in a precarious stage.