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

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

      Kai-Fu Lee's 01.ai is raising funds in a pre-IPO round ahead of a projected Hong Kong listing in 2027, as he shared with Bloomberg during the World AI Conference in Shanghai. The company is changing its offshore holding structure, a step that Moonshot took in May to facilitate its own Hong Kong debut. Lee mentioned that this funding round will conclude around the time 01.ai releases its first annual results, with the fiscal year ending in December.

      The narrative behind the IPO reflects a strategic pivot that evolved into a business. Founded in 2023, 01.ai initially aimed to develop leading AI models and achieved a valuation of $1 billion with support from Alibaba’s cloud division. However, the economic landscape shifted when DeepSeek’s open-weight releases disrupted the model training industry. Acknowledging the challenge, Lee stated, “Only a handful of companies with essentially bottomless balance sheets could still justify the cost of building models from scratch. Everyone else needed a new business model.”

      In response, the company has transitioned to enterprise data infrastructure. 01.ai has stopped building foundational models and now fine-tunes existing Chinese open-weight models such as DeepSeek, Alibaba’s Qwen, and Z.AI’s GLM. It packages these models in software that organizes a client’s disparate data pools for instant querying and visualization. Lee calls the product “Boss AI” and characterizes 01.ai as the “Palantir of China.” The software is designed to be deployed on-premises rather than in the cloud, as enterprise clients prefer to keep sensitive data in-house. Approximately half of 01.ai’s business now originates from outside China, including regions in Asia, Europe, and South America. However, Lee has excluded the U.S. market, noting that buyers there remain cautious about Chinese software.

      01.ai employs around 240 people, which is relatively small for an AI startup. It was part of China’s original "AI Tigers" alongside Z.AI, MiniMax, StepFun, DeepSeek, and Moonshot. Z.AI and MiniMax have already gone public in Hong Kong, while Moonshot intends to list within six months at a $30 billion valuation. DeepSeek is also preparing for a 2027 IPO. This pivot positions 01.ai to enter the exchange with a significantly different approach: not as a model builder competing on performance benchmarks, but as an enterprise software firm competing on revenue. The upcoming IPO will reveal whether the market appreciates this pragmatic shift or reacts negatively.