Image source @ Visual China
Wen | Blue Media, the author | Black Sheep
In 2020, Zhou Xi, founder of Cloud Cong technology, proposed an incentive model called "access sharing system" in an internal email.
This management model, which was born in Huawei, is intended to hope that employees will focus on how to coexist and make the cake bigger.
Later, someone asked the executives of cloud technology how effective this model was, and the executives replied: Through this way, the cloud makes employees willing to stand more in the customer's point of view and the next link to do things and think.
The cloud in 2020 encountered a moment when capital gradually withdrew from the AI field and had to be listed to replenish blood. At that time, it also realized that only technology and no scenes could not make the STORY of AI full.
Moreover, Yun Cong is still losing money, and does not know when to turn a loss into a profit.
On April 7 this year, the CSRC disclosed that Yuncong Technology Group Co., Ltd.'s initial public offering of shares and listing on the Science and Technology Innovation Board was approved.
Cloud technology is called "AI Four Little Dragons" together with Megvii Technology, Yitu Technology and SenseTime Technology. Cloud was approved from the IPO registration of Technology, which means that after SenseTime, the "AI Four Little Dragons" will soon give birth to the second listed company.
Founded in March 2015 and incubated in Chongqing Green and Intelligent Technology Research Institute of the Chinese Academy of Sciences, the AI technology company is headquartered in Guangzhou, providing artificial intelligence solutions for customers in the fields of smart finance, smart governance, smart travel and smart business.
Now, it is still facing the problems of losses, business overlap, and insufficient landing of technical scenarios - the cloud has been listed, but it is still foggy.
Listed at a loss
Planning to raise 3.75 billion yuan, the cloud of the IPO of the science and technology innovation board will show its fists in the field of AI and cross the fog.
The first is losses – which is already the norm for AI companies.
In the "AI Four Little Dragons", Megvii Technology lost more than 13 billion yuan from 2017 to 2020, and YITU Technology lost 5.969 billion yuan from 2017 to 2019.
Clouds are never comparable.
According to the prospectus, from 2018 to 2020, the main business income of Cloud from technology was 483 million yuan, 780 million yuan and 751 million yuan, and the net profit attributable to the mother was -181 million yuan and -1.708 billion yuan and -690 million yuan, respectively.
The reason why the cloud loses money from technology is a common phenomenon in AI companies - research and development is high.
According to the prospectus, in 2018 and 2020, yun's research and development expenses from science and technology were 150 million yuan, 450 million yuan and 580 million yuan, accounting for 30.6%, 56.3% and 76.6% of the revenue of each period, respectively.
Behind the continuous stacking of research and development, the cloud from the face of the market is relatively narrow, from its products can be seen - such as cameras, machine collaborative operating systems, airport check-in systems or brush face payment pads, etc., these common products in life to build a relatively stable business line from the cloud, but also make the cloud from the AI technology easier to be understood.
Again, this makes the cloud look more like an AI security equipment manufacturing company.
"National team" player
In the prospectus, Yuncong announced its profit plan - to turn a profit into a profit in 2025.
Cloud technology is incubated from the Chongqing Research Institute of the Chinese Academy of Sciences. After the establishment of the company, it completed an angel round of financing of 60 million yuan. In 2017, it also received 2 billion government funding support from the Guangzhou Municipal Government for Cloudcong Technology. Before the listing, Yuncong Technology has carried out 6 rounds of financing, with a financing amount of more than 3 billion.
From the list of capital behind the cloud, it also shines with the sign of the national brand. For example, in the B+ round of 1 billion financing in October 2018, it included China Guoxin, Guangzhou Industrial Investment Fund, Guangdong Yueke Financial Group, Shanghai Liansheng Capital, Bohai Industrial Investment Fund and other Chinese national strategic investors, which also made Yuncong Technology once described as an "artificial intelligence national team".
In addition to having the endorsement of the national brand, Zhou Xi, the founder of Yuncong, is also a genius aura.
Xi Zhou is the "Father of Computer Vision" Thomas S. Huang Xutao, one of the three students enrolled worldwide in 2006. In 2015, he returned to China to work in Chongqing, the Chinese Academy of Sciences, and later led the team to found Yuncong Technology.
The list of founders and capital behind them is so dazzling, which provides a lot of convenience for Yuncong's AI products to land in state-owned institutions.
From the first business of the cloud is to develop a complete set of software and hardware for face recognition for the Guangdong Provincial Public Security Department, by September 2020, its research and development of the fire-eye and eagle-eye combat systems has covered a number of public security systems across the country.
In addition to public security, Yuncong has also deployed facial recognition products to banks, providing intelligent services for more than 400 financial institutions and more than 100,000 bank outlets across the country.
It may seem that the cloud with technology and hardware should always be smooth sailing, but one of its problems lies in the common problem of "Xueba Genius Company" - having technology but not very business-like.
Cloud from the early years of technology to align business with bank facial recognition systems. In order to win a bank project, the team held back for a few days to write a perfect and detailed ppt program to participate in the bidding, and the bank took the ppt and said: Never a supplier has ever written a dozen pages of the plan for them, at least 300 pages.
Another problem is that the current product development field of AI companies is more or less overlapping.
Differentiation is hard to solve
From the perspective of vision and security, the technology landing of the cloud is not exclusive - the commercialization of the "AI Four Little Dragons" almost all start from the fields of consumption and security, but in each prospectus, the classification of industry fields or application scenarios is different.
For example, SenseTime explained in the prospectus that the source of income covers four sectors: smart business, smart city, smart life and smart car, of which the application of security technology accounts for a large part.
The other is divided into two parts according to the application industry - intelligent public services, the former including urban management, medical health, and the latter covering park management, network services, safety production, transportation and internet services.
Why is everyone working in this area? Because the prospect is more open.
According to the Sullivan report, it is expected that by 2025, the size of China's computer vision software market will reach 101.7 billion yuan, with a compound growth rate of 43.5% from 2020 to 2025, and the proportion of the global computer vision software market will reach 23%.
But in the same way, where AI companies compete with each other, homogeneous technologies are superimposed on each other in the market, resulting in many uncertainties at the operational level.
Yuncong also pointed out in a reply to the implementation letter: in the future, in the face of fierce competition in the market, the price of major products has declined, the R&D investment has continued to increase and the R&D results have not been converted in time, the artificial intelligence industry policy has adversely affected, and the demand for downstream industries has slowed down significantly, and the company will face short-term unprofitable profitability, and there is a risk of continuous expansion of unmade losses, and it is imperative how to reverse the financial data of continuous losses.
Therefore, even with the blessing of the national team and the leadership of the academic leaders, in the field of AI, how to differentiate the technology is still a problem faced by AI companies.
From this point of view, the cloud raised funds from the landing of the science and technology innovation version, which is intended to be used for the human-machine collaborative operating system upgrade project, the light boat system ecological construction project, the artificial intelligence solution integrated service ecological project and the supplementary working capital.
It may seem clear, but it's not enough to let the cloud take off.