Artificial intelligence in today's era can be described as a boom. With the continuous expansion of artificial intelligence application scenarios, the AI track has become more and more lively.
Recently, the wave of AI companies going public will add another member.
On March 17, Geling Shentong, a well-known domestic artificial intelligence technology company, was successfully listed on the Shanghai Stock Exchange, officially becoming the first artificial intelligence stock on the A-share Science and Technology Innovation Board. However, the stock price trend on the first day of listing was not optimistic. It broke at the opening and closed at 37.46 yuan, a drop of 5.14%. As of press time, it was reported at 34.9 yuan, a drop of 6.38%.
When the focus of the artificial intelligence industry is gradually shifting to industrial implementation, more and more giants are investing in AI, which makes the survival of AI companies that are difficult to make profits even more difficult. As far as the current situation of Geling Shentong is concerned, there are still some problems from multiple angles. Challenges and fierce competition in the market.
Capital-driven "AI Dark Horse"
Founded in 2013, GreenShentong is an early explorer and practitioner of the domestic computer vision industry and algorithm technology. It has a large number of self-developed core algorithms in the field of computer vision, and has won many times in domestic and foreign artificial intelligence algorithm competitions. .
As an industry-leading AI company, Geling Shentong focuses on the deep integration of advanced computer vision technology and big data analysis technology with application scenarios, providing services for urban management, smart finance, commercial retail, sports health, rail transit operation and maintenance and other fields. artificial intelligence products and solutions.
As a pioneer in the industrialization of AI, Geling Shentong has built an underlying AI technology platform that integrates data collection, data preprocessing, data labeling, model training, model optimization and other modules - Deep Tong Brain, and based on this The core technology system has been established. At present, Geling Shentong has formed five major technical directions, including deep learning-based model training and data production technology, 3D stereo vision technology, automated traffic scene perception and event recognition technology, large-scale cross-mirror tracking technology, and robot perception and control technology. .
Among them, in terms of 3D vision technology, Geling Shentong "leads the way". At present, the 3D stereoscopic vision technology of Geling Shentong has been applied in many fields such as smart finance, rail transit operation and maintenance, sports and health, especially in the field of smart finance, and has begun large-scale commercial implementation.
In terms of financing, Geling Shentong’s strong financing ability is also obvious to all. At the beginning of its establishment, it received angel investment from Zhen Fund and Ceyuan Venture Capital. Not long after, it introduced tens of millions of financing from Sequoia Capital. According to the data from Qichacha, up to now, Gelingshentong has received 8 rounds of financing in total. Investors include Zhenyan Investment, Liding Capital, Jiangmen Venture Capital, Sequoia Fund, ZhenFund and other investment institutions.
Even though it is currently favored by the capital market, Gelingshentong does not seem to be satisfied with this, and intends to seize the position of the first artificial intelligence stock on the Science and Technology Innovation Board.
Perhaps one of the most important reasons for the impact on the listing at this time is that after the AI company has experienced multiple rounds of financing, the investment of all investors wants to get a return as soon as possible, especially when Xu Xiaoping, the co-founder of ZhenFund and Sequoia Capital China Shen Nanpeng, the founder and executive partner of the fund, estimated that the future valuation of Geling Shentong is 1.9 trillion yuan, and it is difficult to find new investors.
The disadvantages of "high customer concentration" are highlighted
According to the prospectus data of Geling Shentong, the revenue from 2018 to 2020 will be 51.96 million yuan, 71.21 million yuan, and 243 million yuan respectively. The substantial revenue growth demonstrates its market harvesting ability, but at the same time, losses are also further expanding. From 2018 to 2020, the net profit of Geling Shentong deducting non-returnable mothers is -92.3 million yuan and -189 million yuan respectively. , -102 million yuan.
Behind the loss is the high period cost. It has been investing heavily in research and development activities to continuously develop cutting-edge technologies and provide innovative solutions, with research and development expenditure accounting for the majority of the total costs and expenses. From 2018 to 2020, the company's R&D, management, and sales expenses accounted for 230.22%, 623.02%, and 108.08% of the total revenue, respectively.
On the other hand, look at the R&D investment of ArcSoft Technology, the "first visual AI stock". According to the financial report data of Arcsoft Technology, in terms of research and development, Arcsoft Technology will invest 259 million yuan in research and development in 2020, a year-on-year increase of 32.28%, accounting for 37.9% of total revenue, which is higher than the industry average. However, compared with the proportion of R&D investment of Green Deep Eye, this figure is obviously much lower.
According to the data of Wudu Yilian, the leading enterprises in the domestic market have gradually occupied the main market share, and the concentration is getting higher and higher. SenseTime ranks first with 17.4%, followed by Megvii Technology with 15.2%, and CloudWalk Technology with 9.8% %, followed by Yitu Technology with 9.0%. However, the security field that Gelingshentong focuses on is extremely competitive. Hikvision, the leading security company in the A-share market, has a revenue of 63.5 billion yuan in 2020, which is dozens of times higher than that of Gelingshentong in terms of volume.
From the perspective of Gelingshentong itself, according to the prospectus data, from January to June 2021, the company’s top five customers contributed 74.54% of the total revenue, compared with 67.55% in 2019, it can be seen that Gelingshentong The business dependence on major customers is very obvious, but it should be noted that although the strategy of major customers can bring relatively large order amounts, there are risks of difficult customer negotiations and customer concentration.
But in the long run, the market prospect of Geling Shentong still has a broad room for growth.
The AI market is still "fierce battle", is it still too early to reap the dividends?
With the gradual maturity of AI technology and the deepening of the layout of industry giants such as technology and manufacturing, the application scenarios of artificial intelligence continue to expand. According to the "China Artificial Intelligence Industry Research Report (2020)" report released by iResearch, in 2019, the scale of China's artificial intelligence core industry and driven industry was 108.86 billion yuan and 382.15 billion yuan respectively, and it is expected to reach 453.26 billion yuan by 2025. billion and RMB 1,664.83 billion, with compound annual growth rates of 26.8% and 27.8% respectively.
But where there are vents, there is danger.
As early as the beginning of 2018, there were frequent rumors of unicorn companies in the field of artificial intelligence going public. These companies were not established for a long time at the time, and their hematopoietic capabilities were weak. They mainly relied on financing to maintain high investment in talent, R&D and commercialization.
The popularization of a new technology does not only require the research and development of scientists, but the implementation of some businesses can attract the attention of the market and users, thereby accelerating the popularization and implementation of technology, and finally promoting the development of technology.
As a star enterprise in the AI industry, the successful listing of Gelingshentong has further demonstrated the potential of AI companies to the capital, and also proved that AI technology is being accepted by more and more people.
However, for AI start-ups investing in R&D, the problem is also obvious. Unlike fast-iterating consumer products, the R&D and commercialization of hard technologies such as AI is a high-risk thing. Millions of fees will go down the drain.
With the AI industry gradually returning to the essence of business, every AI company is about to face the big test of survival of the fittest in the market. The market's higher requirements for AI may become a fire for AI companies to improve their technology, but it may also become a drag. The "gold swallowing beast" that breaks cash flow.
With the advancement of the "Chinese system" of artificial intelligence, companies that seize the opportunities of the times are infinitely approaching the future. After Geling Shentong goes public, how to advance bravely in the competition in the field of AI and verify the value of empowering the real economy in more scenarios will become its new challenge.
Source: New Industry Insights