Chinese Facial Recognition Company Megvii Plans Hong Kong IPO

Megvii has filed for a Hong Kong IPO with a goal of raising at least $500 million. The Beijing-based AI startup is backed by Ant Financial, Alibaba, and the Chinese government...and while revenue is quickly growing, so are losses.

This may be wrong time, wrong place: Megvii is perhaps best known for hawking its facial recognition wares, known as Face++, to customers around China. As you know, Hong Kong is convulsing with protests at the moment. Facial recognition tech has played a central role in the sometimes violent dance between police and demonstrators.

In its prospectus, Megvii cops to this tension and cites negative press around facial recognition as an investment risk, along with high R&D costs and the trade war.

Zoom out: China has a large domestic surveillance market and its companies export facial recognition tech around the world. U.S. financiers are bullish: Citi, Goldman Sachs, and JPMorgan are cosponsors of Megvii's IPO.