Kai-Fu Lee has shifted from creating AI models to offering enterprise data infrastructure. Currently, 01.ai is preparing for an IPO in Hong Kong.

Kai-Fu Lee has shifted from creating AI models to offering enterprise data infrastructure. Currently, 01.ai is preparing for an IPO in Hong Kong.

      TL;DR01.ai is aiming for an IPO in Hong Kong by 2027 after shifting from creating AI models to focusing on enterprise data infrastructure. Lee refers to the product as “Boss AI” and identifies the company as “the Palantir of China.”

      Kai-Fu Lee's 01.ai is preparing for a pre-IPO funding round ahead of its proposed Hong Kong listing in 2027, as stated by the former head of Google China during the World AI Conference in Shanghai. The company is reversing its offshore holding structure, a move similar to what Moonshot did in May to facilitate its own Hong Kong debut. Lee mentioned that the funding round is expected to conclude around the time 01.ai releases its first annual financial results, with the fiscal year ending in December.

      The narrative behind the IPO reflects a strategic shift that evolved into a business opportunity. Founded in 2023 with the aim of developing cutting-edge AI models, 01.ai achieved a valuation of $1 billion with support from Alibaba's cloud division. However, the open-weight releases from DeepSeek disrupted the economics associated with model training, leading Lee to reconsider. He acknowledged that “only a few companies with practically limitless financial resources could still justify the expense of creating models from scratch,” adding that “everyone else needed a new business model.”

      Lee's solution is to focus on enterprise data infrastructure. 01.ai has shifted from constructing foundational models to fine-tuning existing Chinese open-weight models like DeepSeek, Alibaba’s Qwen, and Z.AI’s GLM, packaging them with software that organizes a client's diverse data pools for immediate querying and visualization. He labels this offering “Boss AI,” positioning 01.ai as “the Palantir of China.” The software is designed for on-premises deployment instead of cloud services, as enterprise customers increasingly prefer to retain sensitive data internally. Approximately half of 01.ai's revenue now comes from international markets, including Asia, Europe, and South America, though Lee has excluded the US market due to hesitance from buyers regarding Chinese software.

      01.ai employs around 240 people, which is considered lean for an AI startup. It was part of China's original "AI Tigers" alongside companies like Z.AI, MiniMax, StepFun, DeepSeek, and Moonshot. Among this group, Z.AI and MiniMax have already gone public in Hong Kong, while Moonshot aims to list within six months at a valuation of $30 billion, and DeepSeek is also planning an IPO in 2027. Lee’s strategic pivot means that 01.ai will approach the market with a markedly different proposition: not as a model developer competing on performance metrics, but rather as an enterprise software firm competing based on revenue. Whether the market will appreciate this shift or penalize it remains to be seen in the forthcoming IPO.

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Kai-Fu Lee has shifted from creating AI models to offering enterprise data infrastructure. Currently, 01.ai is preparing for an IPO in Hong Kong.

Lee admitted defeat in the model race after DeepSeek. 01.ai is now refining open-weight models and integrating them with data software for businesses. Fifty percent of its operations are based outside of China.