The official website of the Hong Kong Stock Exchange (HKEx) showed on Tuesday that an IPO application submitted by Chinese AI startup 4Paradigm on August 13, 2021 was invalid, as it has failed to pass the hearing within six months.
Founded in 2014, 4Paradigm is an AI platform and technical service provider. The company mainly helps client firms in upgrading intelligently through AI, accelerating the transformation process of traditional industries and improving the operational efficiency of enterprises. Dai Wenyuan, founder of 4Paradigm, used to be the chief architect of Baidu and the Huawei Noah’s Ark Lab.
Up to now, 4Paradigm has more than 8,000 customers, including the Industrial and Commercial Bank of China, China Merchants Bank, PetroChina and more, with about 12,000 projects now launched.
In June last year, the company reached a strategic cooperation with leading Chinese battery firm Contemporary Amperex Technology Co., Ltd. (CATL). According to the official introduction, CATL will build an AI platform based on full-process AI technology and production tools such as 4Paradigm Sage AIOS data governance, model launch and model self-learning. In the future, both parties will continue R&D in areas such as product development, quality inspection and scheduling optimization.
International market analysis firm IDC released a report last year on AI market share in the first half of 2021. In the machine learning category, 4Paradigm won the biggest share for the fourth consecutive year.
The firm’s prospectus shows that revenue of 4Paradigm has increased annually in recent years. Its revenue from 2018 to 2020 was 128 million yuan ($20 million), 460 million yuan and 942 million yuan, respectively. In the first half of 2021, the company’s revenue was 788 million yuan, which was close to the total annual revenue of 2020.
However, the company has not yet made a profit. In 2018, 2019, 2020 and the first half of 2021, its operating losses reached 336 million yuan, 551 million yuan, 560 million yuan and 857 million yuan, respectively. The company has been investing huge sums of money in technology R&D. In 2018, 2019, 2020 and the first half of 2021, its R&D expenses accounted for 151.2%, 90.6%, 60% and 73.4% of the revenue in the corresponding period, respectively.