01.ai eyes 2027 Hong Kong IPO after pivot from AI models

Kai-Fu Lee’s 01.ai is preparing for a 2027 Hong Kong IPO, after abandoning its original plan to build frontier AI models and repositioning itself as an enterprise data infrastructure company.

Lee, the former Google China chief, told Bloomberg at the World AI Conference in Shanghai that 01.ai is raising a pre-IPO round ahead of the planned listing. The company is also unwinding its offshore holding structure, the same step Moonshot took in May before pursuing its own Hong Kong debut. Lee said the fundraising round should close around the time 01.ai publishes its first annual results. Its fiscal year ends in December.

01.ai was founded in 2023 to build frontier models and reached a $1 billion valuation with backing from Alibaba’s cloud unit. But Lee said DeepSeek’s open-weight releases upended the business case for training new models.

“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.”

That new model is what Lee calls “Boss AI.” Instead of building foundation models, 01.ai now fine-tunes existing Chinese open-weight models including DeepSeek, Alibaba’s Qwen, and Z.AI’s GLM. It packages them with software that organizes a customer’s fragmented data sources so executives can query and visualize information quickly.

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Lee described 01.ai as “the Palantir of China.” The software is deployed on-premises rather than in the cloud, reflecting enterprise demand to keep sensitive data in-house.

Roughly half of 01.ai’s business now comes from outside China, across Asia, Europe, and South America. Lee said the company is not targeting the US, where customers remain wary of Chinese software.

01.ai has about 240 employees, relatively lean for an AI startup. It was one of China’s original “AI Tigers” alongside Z.AI, MiniMax, StepFun, DeepSeek, and Moonshot. Of that group, Z.AI and MiniMax have already listed in Hong Kong. Moonshot plans to list within six months at a $30 billion valuation, while DeepSeek is also planning a 2027 IPO.

01.ai will reach the market with a very different pitch from its peers: not as a model developer chasing benchmark wins, but as an enterprise software company focused on revenue.