Hong Kong IPO Swells China Software Tycoon’s Fortune to $1 Billion
- Kai Yu started autonomous driving firm in Beijing in 2015
- His personal fortune is estimated at more than $1 billion
While studying for his computer science Ph.D. at the University of Munich, Kai Yu stood out as an ambitious researcher who showed he wanted to be a top name in his field, according to Professor Volker Tresp, one of his supervisors.
Two decades later, Yu’s academic drive has vaulted him to the ranks of the world’s richest people. Shares of his company Horizon Robotics Inc., which debuted in Hong Kong on Thursday, rose more than 30% in early trading, lifting the machine learning expert’s fortune to as much as $1.2 billion, according to the Bloomberg Billionaires Index.
Earlier, the Beijing-based company priced at the top of the range in an offering that raised HK$5.4 billion ($695 million).
The bulk of Yu’s wealth derives from his stake in the developer of hardware and software for autonomous driving, which he founded in 2015 after more than a decade studying and working in the US and Germany.
A press officer for Horizon Robotics declined to comment about Yu’s estimated worth.
The offering has attracted cornerstone investors such as Alibaba Group Holding Ltd. and Chinese internet giant Baidu Inc., underscoring how money is shifting into companies that Beijing deems strategic, such as self-driving cars and artificial intelligence. Horizon Robotics is Hong Kong’s second-biggest listing this year.
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Yu has maintained connections from his student days in Germany. When visiting the country to see clients or take part in conferences over the past twenty years, Yu has met Tresp for catchup dinners several times, his former supervisor said in an interview earlier this week. Tresp is still a professor at the University of Munich and has also worked at a Siemens AG research unit.
In business, Yu forged a joint venture with Volkswagen AG, which two years ago pledged to invest €2.4 billion ($2.6 billion) in a pact with his autonomous driving firm.
Chinese society has been “transformed by digitalization,” which includes cars, Yu told Ralf Brandstaetter, who runs VW’s China business, last year in a video to promote the joint-venture.
“In China people believe cars are becoming like ‘their third space’ other than home and office,” he said, as both rode in a retro-styled electric VW bus.
Horizon Robotics customers include Audi, Hyundai Motor Co. and BYD Co. About 70% of the IPO proceeds will be tagged for research and development over the next five years, with 10% going to Carizon (Beijing) Technology Co., the company’s joint venture with Volkswagen, the IPO document shows.
Scholarly Start
Yu is seen as one of the earliest experts in machine learning in China, particularly for the smart vehicle industry.
For more than three years through 2015, he worked at Baidu, where he was in charge of the company’s Institute of Deep Learning and helped it develop a self-driving car project, one of the first of its kind in the country.
Outside of China, he led the media analytics department of Japan’s NEC Corp. laboratories in California and was the senior research scientist at the Neural Computation Department of Siemens Corporate Technology. His academic work can be found in about 100 papers with more than 30,000 citations, according to the IPO prospectus.
Yu’s academic background also includes a period at the Computer Science Department of Stanford University, where he taught a class called an Introduction to Artificial Intelligence in 2011.
Yu’s father was an automotive engineer who had a strong influence over his career, he said in an interview last year with Gasgoo, a automotive news provider in China. His grandfather worked in the tire industry, he said in the same interview.
After leaving his hometown Nanchang in China’s southeast province of Jiangxi, Yu obtained his bachelor and masters degrees from Nanjing University.
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“Obviously, he wanted to be on top and develop his carrier, and become one of the leading people in his field. But in a nice, collaborative way,” said Tresp. “I think that if he stayed in academia, he definitely would’ve been in the top 10 in his age group.”
(Updates with stock performance in second and third paragraphs)