Chinese AI startup Megvii still plans an IPO despite US blacklist

The Hong Kong stock exchange. (Wikipedia)

Weeks after being put on the US's Entity List, Megvii employees have told the South China Morning Post that the company still plans to file for an initial public offering (IPO) this year.

The company, which has planned to file for an IPO in Hong Kong, previously said that being placed on the US's blacklist could upset its IPO plans. Megvii is barred from purchasing US-made technology like Nvidia's or AMD's GPUs and x86 servers, which are vital to its business.

Goldman Sachs has said it's reevaluating its sponsorship of Megvii's IPO. Citigroup and JPMorgan Chase are sponsors as well.



October 18th

Megvii is a Beijing-based AI company best known for its Face++ facial recognition platform, which is used by businesses, law enforcement and government agencies across China.

The company was founded in 2011 by Yin Qi while he was at Tsinghua University.

Megvii's facial recognition software is used to check-in employees at work and verify user identities in subways, airports, ride sharing apps and online banking. It's also used by police, who according to Bloomberg have used the technology to arrest over 10,000 people.

Below, Bloomberg describes some of Megvii's security and law enforcement uses:

... law enforcement and other customers can link real-time video feeds to run people’s faces through public security databases, or blacklists, to look for criminals, Megvii Corporate Finance Director Tianyu Jiang said at a tech conference last year.

Megvii's corporate clients include Huawei, Lenovo, Foxconn, Xiaomi, China Merchant Bank and Ant Financial, Alibaba's payments company.

In addition to facial recognition used in identity verification, the company is also advancing into Internet of Things-style surveillance and logistical systems for cities and supply chain management.

Megvii, like other Chinese AI companies targeted by the US government, has been accused of helping the Chinese government track and subjugate members of China's Uighur minority. While Face++ code has been found in a police app used to collect data on Uighurs, the code itself wasn't operational, according to Human Rights Watch.