The innovative development of AI technology and business model has reached the time and space node of industrial integration and commercial landing, and Cloudcong technology is expected to establish advantages by virtue of technical barriers and scale effects, ushering in its own golden age.
From the technology (688327), from the submission of the IPO application in December 2020, to the successful meeting in July 2021, and now the science and technology innovation board has been approved for listing, taking the lead in breaking through and becoming the first A-share stock in the "AI Four Little Dragons".
In the industry, Cloud From Technology and SenseTime Technology, Megvii Technology, Yitu Technology and called "AI Four Little Dragons", but in terms of aura and heat, the youngest Cloud From Technology is the most "top stream" existence.
Titles such as "AI National Team Player", "Chinese Academy of Sciences Incubation Enterprise", "China's First Echelon Enterprise of AI", "The First Artificial Intelligence Enterprise that Undertakes the Construction Task of Major Projects such as the National Development and Reform Commission's Artificial Intelligence Basic Platform, Application Platform, and The Open Platform of the Ministry of Science and Technology, and Participates in the Formulation of National and Industry Standards" and other titles, so that the cloud has always been in the C position under the industry spotlight since the birth of science and technology in 2015.
However, if you want to wear the crown, you will be weighed by it. The AI industry has exploded (bubble), large valuations, large financing, large losses, and noise such as "three financial reports (balance sheet, cash flow statement, and income statement) can't bear to look at it directly" and so on.
So far, who is the cloud from technology? How exactly do you view its development? The author hopes that through the analysis of this article, everyone can be inspired to find their own answers.
According to reports, Cloud From Technology is an efficient human-machine collaborative operating system and industry solution provider company. The company's main business is to provide information, digital and intelligent artificial intelligence services through the independent research and development of human-machine collaborative operating system, serving application scenarios such as smart finance, smart governance, smart travel, and smart business.
The author will explain his observations from the four perspectives of "people and organization", "industry environment", "business essence" and "value investment".
vitality
"Investment philosophy" refers to the composition of people and organizations in a company, which will be its greatest internal driving force.
Dr. Zhou Xi (founder of Yuncong Technology), who was introduced to China as an expert in the "Hundred Talents Program" of the Chinese Academy of Sciences, is a person who integrates the thinking of scientists and entrepreneurs in the eyes of colleagues and investors.
In the author's view, the pattern of "clearly choosing not to accept foreign investment" and "being a pure national enterprise" from the technology can also reflect the insight and responsibility of the founder of the company in the field of "card neck".
As a typical talent-intensive industry, we see that most of the cloud from the science and technology team is the Chinese Academy of Sciences, the University of Science and Technology of China expert background, the company has nearly 600 scientific research personnel, R & D personnel accounted for more than 50%, the core team has won the domestic and foreign artificial intelligence field laurels for 9 times, and in 2018 won the "Wu Wenjun Artificial Intelligence Science and Technology Progress Award First Prize".
Looking at the organization, according to public data, in the seven years from the establishment of the company to the launch of the IPO, Yun has raised more than 3 billion yuan from science and technology, and many state-owned and government funds such as Guoxin Capital, China Net Investment, China Reform Fund, Guangzhou Industrial Investment Fund, and Bohai Industrial Investment Fund are its shareholders.
The Chinese Academy of Sciences and state-owned assets background, known as the "AI National Team", "Genzheng Miaohong" brought to Yuncong Technology, not only was invited to participate in the formulation of artificial intelligence national standards, Ministry of Public Security standards and industry standards, but more importantly, let Yun from the commercialization of technology in China's financial and security systems, gained a trust advantage.
In the four industries of semiconductor products, semiconductor equipment, system software, and application software, China does not have a global leader. The development and cultivation of leading enterprises in the industry is a common concern of the government, society and enterprises. The author firmly believes in the national strategic layout and the inherent vitality of the corresponding people and organizations.
golden age
The industry environment refers to the analysis of the time, space and ecology, policy and competition, demand and supply, industrial growth and cycle of AI, and judge the "time and time" of track investment from a macro perspective.
AI always makes people seem to understand. In short, strong artificial intelligence (equivalent to human) is still far away, and the ToC scene is not so sexy, after years of development, AI has achieved an overall jump in productivity in the toB/G business scenario.
Single-point technology represented by computer vision, speech recognition, etc. has achieved breakthroughs and is entering the "two waves" era dominated by technology closed-loop and AI engineering, and the main segments include AI chips, AI platforms, AI solutions and ALoT products.
Since 2018, the US Department of Commerce has continuously thrown out the "Entity List" to suppress Chinese technology companies, of which more than 200 companies have been sanctioned, and artificial intelligence and high-tech companies account for more than 40%.
The mainland's "14th Five-Year Plan" points out that it is necessary to aim at frontier fields such as artificial intelligence, implement a number of forward-looking and strategic major national science and technology projects, and promote the deep integration of the Internet, big data, artificial intelligence and other industries.
The combination of industrial upgrading and policy promotion has accelerated the changes in the relationship between supply and demand in the market. IDC predicts that about 75% of enterprise applications will use AI in 2021, and global spending on AI systems will reach $79.2 billion in 2022.
In the era of "one wave" of single-point breakthroughs, demand is constant, but there are more supply sides, and in the era of "two waves" that need to solve the pain points of the industry, companies like Cloudcong Technology that can provide full-chain technology and have rich industry experience have become scarce.
According to the "In-depth Observation of Artificial Intelligence Development" report released by the China Academy of Information and Communications Technology, in 2020, the scale of the Chinese intelligent industry will be about 310 billion yuan, an increase of 15% year-on-year, and it is expected that the scale of China's AI core industry is expected to reach 157.3 billion yuan in 2022.
Frost & Sullivan predicts that by 2025, China's artificial intelligence market will exceed one trillion yuan, accounting for 20.9% of the global market.
In summary, the current innovation and development of AI technology and business model has reached the time and space node of industrial integration and commercial landing, and leading enterprises such as cloud technology are expected to establish advantages by virtue of technical barriers and scale effects, ushering in their own golden age.
operating system
The business essence of cloud from technology is that of an operating system company. The full name is Human-Machine Collaborative Operating System (CWOS).
As we all know, the chip is the "heart" of AI, and the operating system is the "soul" of AI, and it is also the core technology field of Chinese AI that is "stuck in the neck".
In the chip field, there are companies such as Huawei and Cambrian to "overcome difficulties together", and in the operating system field, there are companies such as cloud technology and the fourth paradigm to "forge ahead".
After understanding the nature and occupancy of the cloud from the technology, the author will sort out its development strategy from the three dimensions of core competitiveness, business model, revenue and growth.
Cloud-technology human-machine collaborative operating system (CWOS) refers to the underlying system platform of the operating system that realizes device access, perception, storage, computing, understanding and decision-making through the unified management of cloud-edge-end integrated devices, AI applications and resources.
CWOS can realize the engineering and modularization of technology and application, facilitate the rapid customization and application of different scenarios (AI engineering), and then realize the three major values of physical world digitization, knowledge generation and service, and accompaniment execution.
Different from the operating systems for C-end users (such as Windows, Android, iOS), the operating system competition pattern for B-end customers has not yet taken shape, and there are still positioning and route differences.
It is gratifying that Yuncong has focused its core competitiveness on human-machine collaboration from technology, not only creating more than 100 key core technologies of AI (images, voice and other technologies have passed the trusted cloud assessment and have national security certification qualifications), but also has gradually realized mature commercial applications.
Based on CWOS, application products, AIoT hardware equipment, etc., it provides customers with AI integrated solutions in the four major fields of smart finance, smart governance, smart travel, and smart business (for example, digital identity authentication, intelligent upgrading of outlets, non-contact remote services, smart risk control and other technical services for customers in the smart financial field), which is a business model that Cloud has run through from technology.
Today, CloudCooper Technology has expanded its business scenarios to broader areas such as smart city/digital infrastructure, and the "Sichuan Tianfu New Area Digital City" project served by CWOS has promoted the collaborative and inclusive development of the city from multiple dimensions and was selected for the 2022 IDC Asia Pacific Smart City Award.
What is more imaginative is that through the ToB/G project precipitation of common algorithm technologies and solutions, CWOS will "grow up" and gradually cover medium and long tail application scenarios: that is, through industry knowledge conversion, swarm intelligence, AI to independently explore/create new service content, product systems, and update regularly.
Imagine the future "three waves" era, with the deep integration with the industry, CWOS will try to embed the intelligent interaction between people and machines into all business processes, connect online/offline data, redistribute intelligent traffic, and greatly optimize the collaborative experience of human and machine intelligence.
Only when we understand its evolution and the possibility of evolution will we understand that AI is a friend of time.
Source: Yuncong Technology Prospectus, Essence Securities Research Center
According to public data, Yuncong Technology has covered more than 400 financial institutions in the field of smart finance, including six state-owned banks, and has served 30 provincial-level administrative regions in the field of smart governance, such as political law, schools, scenic spots, etc., and has deployed china's top ten airports and 105 civil hub airports in the field of smart travel, and has brought smart, convenient and humanized AI experiences to hundreds of millions of people around the world in the field of smart business.
The author believes that from a cyclical point of view, short-term losses are not surprising for small AI giants such as cloud technology, and as a high-tech/high-growth company, it is more meaningful to consider its revenue scale, compound growth rate, net profit growth rate and research and development expenses.
According to the Cloud From Technology Prospectus, from 2017 to 2019, the company's revenue was 64.5337 million, 484 million and 807 million, with a compound growth rate of 253.70% and an average annual net profit growth rate of 358.47%.
From 2018 to 2020, the company's R&D expenses were as high as 849 million, 1.916 billion and 2.454 billion, respectively, and as of March 31, 2022, Yuncong Technology and its subsidiaries had obtained a total of 645 patents that had been filed and were under review.
So far, the cloud can be seen from the business capabilities and vision of technology.
Long slopes with thick snow
Buffett mentioned in the moat theory that patents/technologies, conversion costs, scale effects, cost advantages, network effects, etc. will become competitive barriers for great companies.
Through the author's statement, it is not difficult to see that the scale effect of the cloud from the human-machine collaboration operating system chosen by technology is happening, which will fundamentally change the cost and operating structure, in line with the marginal diminishing and even future compound interest value.
According to the prospectus, the cloud from technology intends to raise 3.75 billion yuan 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 supplementary working capital.
Behind this low-key and pragmatic narrative, hidden is the ability and pattern of cloud to further consolidate its market position from technology and gradually evolve into China's AI unicorn.
In the future, when the infrastructure and ecosystem of AI are gradually improved, its open, compatible, and entropy reduction characteristics will surely create a new trillion-level market.
Now, ai "two waves" has already set sail, "three waves" are not far away, with the technology, facilities, applications, industrial integration and other continuous decoupling, this track will achieve explosive growth.
In the "snowball sport" of technological innovation and business model innovation, there is no one-size-fits-all investment paradigm.
The fluctuation of stock prices and the tracking of parameters are nothing more than people mixed with emotions, a certain period of future expectations, and discounting at the moment. We still have to go back to the larger time and space to see how much industrial and social value this company has created.
The author always believes that only the trend is the friend of time, and choosing AI is choosing this era.