Graffiti Listed In The United States IOT Internet Of Things Ushered In High Light Moment

On the evening of March 18, IOT cloud platform graffiti intelligence was officially listed on the NYSE with the stock code of "Tuya". It is reported that the issue price of graffiti smart is $21, higher than the previous upper limit of $17-20. In addition, according to the 43.59 million ads issued by doodling intelligence (each ads is equivalent to one common share), the financing amount of the IPO will exceed 915 million US dollars.

Graffiti smart was founded in 2014, and is a company focusing on building IOT cloud platform. Its main business includes IOT PAAS, SaaS, distribution of intelligent devices and others. On the day of IPO, Chen liaohan, CO chairman and chief executive of graffiti intelligence, said in an interview with 21st century economic report that starting a business is a hard process. In the early stage of starting a business, it took the whole team a year and a half to find a real customer. "It was a very difficult period at that stage, and we were also thinking about whether we chose the wrong track, but later, relying on the firm belief in the IOT industry, the company's development has improved since 2016."

According to the reporter's understanding, graffiti intelligence established its local headquarters in the United States in 2015, and its business development initially started from overseas markets. Chen liaohan said that in 2015, intelligent equipment in the overseas market had begun to penetrate on a large scale, so the recognition of IOT by overseas customers was higher than that at home. In the domestic market, it was only after the popularity of smart speakers in 2017 that consumers were encouraged to buy more intelligent devices.

According to the prospectus, graffiti smart now has more than 5000 customers, covering 220 countries and regions. Liu Yao, director and CFO of graffiti intelligence, told reporters that because graffiti is a global company with customers all over the world, when choosing the capital market, we preferred US stocks. In addition, graffiti intelligence is a cloud service company, and the US stocks will have a deeper understanding of cloud companies.

Liu Yao revealed that when communicating with investors before listing, their positioning for graffiti is a cloud service company providing IOT infrastructure, which can provide basic services like water and electricity for IOT, and this is exactly the goal of graffiti.

The development of graffiti intelligence benefits from the continuous maturity of the entire IOT market. According to IDC data, the entire global Internet of things market, including hardware, software and services, is expected to grow from $659.2 billion in 2019 to $1112.6 billion in 2024, with a compound annual growth rate of 11.0%.

Compared with seven years ago, the current IOT market has been very prosperous, but compared with the future, it is only the beginning of the era of IOT. For graffiti intelligence, listing is just a new beginning. Chen liaohan said that in the field of IOT, the Chinese market has great potential, and graffiti will invest more resources and energy into the Chinese market.

Enabling people in the IOT industry

According to the prospectus, the business income of doodling intelligence in 2019 and 2020 will be 106 million US dollars and 180 million US dollars respectively. At present, graffiti is still in a loss state. The net losses in 2019 and 2020 are 70.48 million US dollars and 66.91 million US dollars respectively, and the net loss rates are - 66.6% and - 37.2% respectively.

In terms of losses, Liu Yao told reporters that from the past history, it is very common for technology companies to have losses in the early stage, because they have to invest a lot of research and development. But from the financial data, we can see that the current loss of graffiti intelligence continues to narrow. Next, with the expansion of graffiti business and the control of costs, I believe that the loss will continue to decrease.

In terms of revenue composition, IOT PAAS is the core business of graffiti intelligence, accounting for 72.2% and 84.3% of revenue in 2019 and 2020, respectively. It is reported that the doodling IOT PAAS platform can smoothly transform traditional products into Internet of things products with edge computing, storage and network functions. At the same time, the platform can also be seamlessly deployed on public cloud or private cloud infrastructure, such as Amazon Web services, Microsoft azure and Tencent cloud.

Chen liaohan said that in the past, when a product could be connected to the Internet, it would be considered to be very intelligent, but now it is the interconnection between devices. However, for the vast majority of manufacturing enterprises, there is still a high threshold of intelligence, they need an intelligent platform.

According to Chen liaohan, through the graffiti IOT PAAS platform, product companies do not need to build IOT software development platforms and tools from scratch, but can focus on the development of core product capabilities. At the same time, it can also save enterprises huge investment in building and maintaining complex IT infrastructure.

More importantly, this approach does not sacrifice development efficiency. On the contrary, with the help of a dedicated IOT cloud platform, enterprises can save up to 90% of their time. Chen liaohan said that in the past, it took 3-6 months to build an intelligent device from scratch. Now it only takes one day to complete.

According to the prospectus, in 2020, doodling smart IOT PAAS authorized more than 2700 brands to develop its smart devices, including calex, Philips and Schneider Electric. At present, there are more than 1100 intelligent devices developed through doodling IOT PAAS. As of december31,2020, the number of graffiti enabled devices is about 204.3 million.

As for the construction of developer ecology, by the end of 2020, more than 262000 registered developers have been registered on the IOT development platform. The IOT cloud platform processes more than 84 billion cloud requests and 122 million AI voice interactions every day.

In addition to IOT PAAS, graffiti intelligence also provides industry-specific SaaS products to directly help enterprises provide a complete IOT experience. For example, graffiti smart hotel SaaS solution enables hotel managers to monitor different aspects of hotel service from a single point of control.

Chen liaohan believes that due to the strong network effect, graffiti intelligence has established a prosperous ecosystem composed of brands, OEMs, developers, partners and end users on the platform. Because end users of smart devices need an interface to interact with various types of devices of different brands, the experience is similar to using different applications on a smart phone.

The graffiti platform can provide such an open architecture, connecting any device from any brand, and enabling users to manage all devices of each brand through a single interface. Therefore, more and more brands want to join the graffiti platform to integrate their devices into a single user interface and connect other brands of devices through the user interface.

Chen liaohan said that in the past, each brand wanted to build its own independent platform, but now, more and more brands hope to integrate and interconnect with each other. Graffiti with the continuous strengthening of the network effect, further improve their brand awareness and produce word-of-mouth recommendation, which is actually a core advantage in the development process of graffiti.

Born in Alibaba, Tencent investment

With the listing of graffiti intelligence, the founding team of the company will also get rich wealth returns after seven years of hard work. According to the prospectus, before the IPO, Wang Xueji, founder and CEO of doodling intelligence, owned 22% of the shares, while Chen liaohan, CO chairman and CEO, and Zhou Ruixin, co-founder and CTO, respectively, owned 5.6% and 4.2% of the shares respectively.

What makes the outside world pay more attention is the resume of the graffiti intelligent founding team. Data shows that Wang Xueji graduated from Zhejiang University of technology and founded phpwind in 2003, which is one of the most popular open source forums in China, and was acquired by Alibaba in 2008. After joining Alibaba, Wang Xueji served as the first general manager of Alibaba cloud. He initiated and was responsible for a number of core businesses, such as code scanning payment, and held important positions in Alibaba capital and mobile Taobao.

Chen liaohan and Zhou Ruixin, Wang Xueji's alumni, both graduated from Zhejiang University of technology. In 2003, Chen liaohan and Wang Xueji became entrepreneurial partners and jointly founded phpwind. After phpwind was acquired by Alibaba, Chen liaohan served as the chief operating officer of Alibaba cloud and the chief operating officer of Alibaba o2o business successively.

Zhou Ruixin also worked for phpwind and Alibaba before taking part in the creation of graffiti. Yang Yi, another co-founder, joined Alibaba in 2011 and has been responsible for the marketing channels and operation of cloud e-commerce, cloud OS and other strategic businesses.

It can be seen that the whole founding team of graffiti intelligence is a partner who has experienced continuous entrepreneurship together. Therefore, in terms of company management, an insider of graffiti intelligence told the reporter that the relationship of the whole senior management team is very good, because of their different personalities, they also have a clear division of labor in their work and perform their respective duties.

Although the management of the graffiti came from Ali, it was Tencent that appeared on the list of shareholders.

Before IPO, graffiti Smart has finalized six cornerstone investment institutions, namely cppib (Canadian pension fund), dragoner, GIC (Singapore government investment company), Tiger Group, Tencent investment and Hillhead capital, with a total subscription of US $500 million.

Among them, Tencent, as a major shareholder of graffiti intelligence, is to add code again. According to the prospectus, NEA Enyi project investment owns 23.9% of the shares of institutional shareholders, which is the largest institutional investor in graffiti. Tencent has 10.8% equity, which is the second largest institutional shareholder of graffiti. Prior to that, Tencent had invested in graffiti twice in September 2019 and February 2021, with investment amounts of about US $170 million and US $80 million respectively.

Liu Yao told the 21st century economic reporter that Tencent's investment was introduced because Tencent and graffiti are very consistent in some values and product concepts. It says the Internet of things is profoundly changing the way individuals interact with the physical world and the way device companies develop products. The Internet of things provides an opportunity to connect all things and everyone. This is a growth opportunity similar to the mobile Internet. In the long run, the era of Internet of things will surpass the mobile Internet.

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