Alibaba-backed AI startup SenseTime sees over $7.5b valuation

China’s SenseTime Group, currently regarded as the world’s most valuable AI startup, has seen its valuation breach US$7.5 billion this year, following massive investments from the likes of SoftBank.

Sensetime Intelligent Video Analytic. / Photo credit: Sensetime

The company was reportedly valued at US$4.5 million in 2018 after it raised US$600 million in a funding round led by Alibaba and US$620 million from investors such as Fidelity International, Hopu Capital, Silver Lake, and Tiger Global.

SenseTime is using the funds raised to venture into new fields such as semiconductors, developing an AI chip that would complement products by its partner, Nvidia, said SenseTime CEO Xu Li at Bloomberg’s Sooner Than You Think conference in Singapore.

Xu, however, said that the company has “no concrete plan” for an initial public offering.

He said that the startup’s revenue is growing at triple-digit percentages, but cash flow remains negative due to investments in new areas.

Founded in Hong Kong in 2014, SenseTime leverages AI and facial and image recognition technology for various applications including smart cities and surveillance.

The South China Morning Post reported that the startup’s latest expansion efforts come at a time when many industries are investing aggressively in AI projects.

“Many believed that 2018 was the year when AI became more embedded in industries,” Xu told the Post. “But there’s still a long way before the technology becomes truly ubiquitous.”

According to research firm IDC, worldwide spending on AI systems is expected to reach US$79.2 billion in 2022 at a compound annual growth rate of 38% from 2018 to 2022.