China’s startup ecosystem, which produced several world-leading companies, has been in the news in the recent past about the impact of the government regulations on the big technology firms. However, despite the regulatory shakeups and the COVID-19 pandemic notwithstanding, China has emerged as a powerhouse for artificial intelligence (AI) unicorns, according to Thematic Research at GlobalData, a leading data, and analytics company.
GlobalData’s research shows that of the total of 45 AI unicorns globally, China has the biggest share with 19 unicorns headquartered in the country. These 19 unicorns are collectively valued at $43.5 billion.
Priya Toppo, Analyst of Thematic Research at GlobalData, comments, “China is a leading player in AI, with a number of established companies such as Baidu, Hikvision, iFlytek, Tencent, and Alibaba. The country also has a strong AI startup ecosystem, which is evident from the large number of AI unicorns (privately held startup valued at $1 billion or more).”
China is leading in certain key themes such as computer vision and facial recognition via startups such as SenseTime, Cloudwalk, Megvii, and Yitu Technology. These companies are commonly referred to as the ‘Chinese AI dragons’.
SenseTime is currently the biggest AI unicorn in China with a valuation of $12 billion and total funding to date of $2.6 billion. The next biggest Chinese AI unicorn Cloudwalk is valued at $3.3 billion with total funding of $500 million, followed by Megvii with a valuation of $4 billion and Yitu Technology with a valuation of $2.2 billion. Horizon Robotics is another notable unicorn that achieved a valuation of $5 billion.
“Chinese AI companies have faced several regulatory challenges but have emerged even stronger. The companies are well placed in key themes such as computer vision, deep learning technologies, smart cities, and autonomous vehicles,” Toppo continues.
SenseTime and Cloudwalk have already filed for IPOs in Hong Kong and Shanghai, respectively. Megvii also has a Shanghai IPO plan in the pipeline. This will be Megvii’s second attempt to list after the first attempt was canceled in February 2020 due to the COVID-19 pandemic. Yitu Technology is also considering an IPO in Hong Kong at a projected valuation of $4 billion.
“The Chinese AI ecosystem will become even stronger as leading companies go public and are able to invest the significant amounts of new capital raised,” Toppo concludes.