UOB Venture-backed Chinese AR firm WiMi Hologram raises $26m in US IPO

REUTERS/Eric Thayer

WiMi Hologram Cloud Inc, a Chinese provider of ad services and software used in holographic augmented reality (AR), raised $26 million in its IPO in the US after pricing its American depositary shares (ADSs) at $5.50, the lower end of its target range.

The Beijing-based company has become the first firm to launch a successful IPO in the US since the World Health Organisation declared the COVID-19 pandemic, according to UOB Venture Management, one of its backers. The listing gives WiMi a market value of $325 million.

WiMi listed on the Nasdaq Stock Market on April 1 and closed at its IPO price of $5.50 on its trading debut. The price, however, dropped to $5.39 at the close of the trading day on Wednesday.

The Beijing-based company had previously filed to offer 4 million ADSs at a price range of $7.50 to $9.50, which would have seen it raise $34 million at the midpoint of the range. WiMi, however, lowered the price range to $5.50 to $7.50 but raised the ADSs offering to 5 million.

WiMi aims to use the bulk of the IPO proceeds for research and development purposes, including the development of holographic facial recognition systems, AI facial change, digital life system, holographic education intellectual properties, navigation system for cars, and more.

It also seeks to finance strategic acquisitions and investments using the IPO proceeds.

Founded in 2015, WiMi’s software allows users to insert real or animated three-dimensional objects into video footages to create an immersive and interactive holographic AR experience. The company claims to be the leader in China’s $500-million and growing holographic AR space.

For the 12 months ended June 30, 2019, WiMi Hologram booked $39 million in revenue, with 83.1 per cent of the total generated by its holographic AR advertising services.

In the first half of 2019, holographic AR ads produced using the company’s software generated a total of approximately 4.9 billion views, as compared to approximately 2.7 billion views during the same period in 2018, representing an increase of 81.5 per cent.

The company, however, acknowledges that the ongoing COVID-19 pandemic poses a substantial risk to its operations and financial condition.

“The global stock markets have experienced, and may continue to experience, a significant decline from the COVID-19 outbreak. It is possible that the price of our ADSs will decline significantly after the consummation of this offering, in which case you may lose your investment,” WiMi said in its amended SEC filing.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.