(Bloomberg) — Becomes co-founder of SenseTime Group Inc. Tang Xiao’ou is one of the world’s richest people, after the Chinese AI champion blew past concerns about US sanctions for a 23% increase in his Hong Kong debut.
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MIT’s fortune jumped by $500 million to nearly $3.9 billion after SenseTime ended the morning session nearly 11% above its initial public offering price, according to Bloomberg Billionaires Index.
SenseTime’s debut defied all expectations, especially after a US ban on US investors forced AI to delay its initial public offering, then price its shares below the previously indicated range.
Investors have been concerned about the fallout from the blacklist, which stems from allegations that SenseTime’s facial recognition software perpetuates human rights abuses in the country’s far western region of Xinjiang. The punishment, which came on top of the current ban on US tech sales, was announced just days before the debut.
SenseTime said the accusations were unfounded. Its CEOs were visibly moved Thursday when they gathered for the listing’s live event, with at least one tearful as the pop opening was announced.
Each company will have its own challenges and goals. “For us, it is about getting back to the fore as innovators and pioneers,” Xu Lee, Tang’s fellow and CEO of SenseTime, said during the ceremony attended by Paul Chan, Hong Kong’s financial secretary.
READ MORE: SenseTime Jumps Into Debut After IPO Delayed Due To US Sanctions
SenseTime is the first overseas offering from a high-tech Chinese unicorn since Didi Global Inc’s June IPO in New York sparked a regulatory backlash from officials in Beijing, effectively freezing most major tech debuts.
Tang’s rapid rise contrasts with that of his peers at China’s biggest tech companies, which collectively lost about $80 billion in wealth in 2021 thanks to Beijing’s year-long campaign to rein in technology overreach. Unlike many of his colleagues, the co-founder of SenseTime hails from the world of academia, as a professor of information engineering at the Chinese University of Hong Kong.
He has long been involved in the development of artificial intelligence required for facial recognition. Tang earned his undergraduate degree from the University of Science and Technology in China, then graduated from the University of Rochester in New York and received his Ph.D. from MIT in 1996, where he studied underwater robotics and computer vision.
Tang worked in Microsoft Research Asia for a few years before co-founding Shanghai-based SenseTime in 2014 with Xu, then a research scientist at Lenovo Group Ltd. Alibaba Group Holdings Limited and Silver Lake.
Read more: China’s tech tycoons see $80 billion in wealth evaporate in 2021
Investors may now rely on SenseTime’s domestic growth prospects even as opposition solidifies abroad. SenseTime is the largest artificial intelligence software company in Asia with a market share of 11%, according to the preliminary prospectus. The technology is being deployed in a range of areas, including assisting police in China, providing product placements in movies and creating an augmented reality scene in a mobile game by Tencent Holdings Ltd.
It relaunched its IPO days after being blacklisted with a group of core investors raising their stakes to $512 million. Those included state-backed names such as the Mixed Ownership Reform Fund and Shanghai Xuhui Capital Investment Co.
SenseTime’s revenue increased 14% last year to 3.4 billion yuan ($534 million), although it still incurred an operating loss.
“Investing heavily in early-stage technology research and development is the only way to make an impact on the industry,” Shaw said in a pre-recorded interview with Bloomberg TV. “For us, we see a very clear path to profitability for the next few years, thanks to our early investments in AI infrastructure.”
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