Kai-Fu Lee’s first Europe bet, WeRide buys a truck startup – TechCrunch

Hello, and welcome back to TechCrunch’s China Roundup, a round-up of the recent events that have shaped the Chinese technology landscape and what it means for people in the rest of the world.

Despite the geopolitical headwinds for foreign tech companies to invade China, many companies, especially those that find a reliable partner, are still pushing forward. For this week’s recap, I’m adding a conversation I had with Prophesee, a French vision technology startup recently funded by Kai-Fu Lee and Xiaomi, along with the usual news recap.

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Like many companies working on futuristic cutting-edge technology in Europe, Prophesee was a spin-out from university research laboratories. Before that, I covered two such companies from Sweden: Imint, which improves smartphone video production through deep learning, and Dirac, an expert in sound optimization.

The three companies have two things in common: They all operate in niche areas and have all found avid customers in China.

For Prophesee, it’s production lines, automakers, and smartphone companies in China looking for breakthroughs in perception technology, which in turn will improve their robots’ response to the environment. It is therefore not surprising that Xiaomi and the Chinese chip-focused investment firm Inno-Chip have supported Prophesee in their latest financing round, which was led by Sinovation Venture.

The funding size was not disclosed, but TechCrunch learned it was in the “tens of millions”. It was also the first investment Kai-Fu Lee made in Europe through Sinovation. Luca Verre, CEO of Prophesee, recalled:

I met Dr. Kai-Fu Lee three years ago at the World Economic Forum … and when I talked to him about Prophesee, he was very intrigued. And then we actually stayed in touch for the past three years and last year he decided to jump in, given the growing pull we had in China, especially in the cellular and IoT industries, so the timing prophesee is going to be big.

The Paris-based company did not actively seek funding, but believed that Chinese strategic investors could give it better access to the complex market.

Instead of sending information gathered by sensors and cameras to computer platforms, Prophesee integrates this process into a chip (manufactured by Sony) that mimics the human eye, a technology based on neuromorphic engineering.

The old method snaps up a collection of fixed images, so that as the amount of information increases, enormous computing power is required. In contrast, Prophesee’s sensors, which it calls “event-based”, only pick up changes in the environment, just like the photoreceptors in our eyes and can process information continuously and quickly.

Europe was at the forefront of neuromorphic computing, but in recent years Verre has seen a surge in research from Chinese universities and tech companies, reaffirming his confidence in the marketplace.

We see Chinese OEMs (Original Equipment Manufacturers), especially Xiaomi, Oppo and Vivo, pushing the quality standard of image quality to very, very high … They are very interested in introducing new technologies to differentiate faster and more aggressively than Apple. Apple is a company with an attitude that to me is more like Huawei. So with some technologies, it may take more time to see the technology mature and adopt, which is very often correct, but later. So I’m sure at some point Apple will come out with some products that incorporate event-based technology. In fact, we see them move. We see them filing patents in space. I’m sure this will come, but maybe not the first.

Although China is seeking technological independence, Verre believed Prophesee’s addressable market is large enough – $ 20 billion by his estimate. Nonetheless, he admitted that he “would be naive to believe that Prophesee will be the only one to take advantage of this opportunity”.

WeRide bought a trucking company

One of the most valuable robotaxi startups in China has just taken over an autonomous haulage company called MoonX. The size of the deal is unknown, but we do know that MoonX raised “tens of millions of RMB” in a Series A round 15 months ago.

While WeRide focuses on level 4 self-driving technology, it is also finding new ways to monetize it before its robotaxis can chauffeur people on a large scale. It does so through the development of minibuses, and the acquisition of MoonX, which brings the company’s founder and 50+ engineers to WeRide, is likely to help diversify its revenue pool.

WeRide and MoonX have deeply rooted relationships. Their respective founders, Tony Han and Yang Qingxiong, worked side by side at Jingchi, which was later renamed WeRide. Han co-founded Jingchi and took the helm as CEO in March 2018, while Yang was named Vice President of Engineering. But Yang soon gave up and started MoonX.

Han, a Baidu veteran, gave Yang a warm homecoming and placed him in charge of the company’s research institute and its new office in Shenzhen, home of MoonX. WeRide’s sprawling headquarters are only about an hour’s drive away in the neighboring city of Guangzhou.

The AI ​​surveillance giant Cloudwalk is about to go public

Cloudwalk is part of a cohort of Chinese unicorns who thrived in the second half of the 2010s selling computer vision technology to government agencies across China. Collectively, Cloudwalk and its rivals SenseTime, Megvii and Yitu have been dubbed the “four AI dragons” due to their rapidly increasing ratings and pretty funding rounds.

Of course, the term “AI dragon” is now a misnomer as AI applications are so ubiquitous in all industries. Investors soon realized that these newcomers need to diversify sources of income beyond smart city contracts, and they are eagerly awaiting exits. Finally comes Cloudwalk, who will likely be the first in his cohort to go public.

Cloudwalk’s request to raise 3.75 billion yuan ($ 580 million) from an IPO on the Shanghai STAR Board was approved this week, although it may be months before trading begins. The company’s financial results don’t look particularly bright for investors, with a net loss of 720 million yuan in 2020.

In the news too

  • Regarding the barrage of autonomous driving news, vehicle vision provider CalmCar said this week it has $ 150 million raised in a round of the series C. Founded in 2016 by several overseas Chinese returnees, CalmCar uses deep learning to develop ADAS (Advanced Driver Assistance System) used in automotive, industrial and surveillance scenarios. The German auto parts manufacturer ZF led the round.
  • Baby clothes aimed directly at the consumer PatPat said it raised $ 510 million from Series C and D rounds. The D2C ecosystem that leverages China’s resilient supply chains is gaining increasing interest from venture capitalists. Brands like Shein, PatPat, Cider and Outer have all secured funding from established VCs. PatPat was founded by three Carnegie Mellon graduates and has IDG Capital, General Atlantic, DST Global, GGV Capital, SIG China and Sequoia China among its investors.

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