China’s work automation startup Laiye raises $160 million to acquire French Mindsay – MovieUpdates

An ambitious Chinese startup wants a slice of the booming global work automation market. Laiye, a Beijing-based company that provides a comprehensive platform for automating office tasks of varying degrees of complexity, has just raised $160 million from a Series C funding round to expand globally.

Guanchun Wang, the founder and CEO of Laiye, saw the “value of artificial intelligence” in his years working in Baidu’s smart speaker division after his movie discovery startup was sold to the Chinese search engine giant. At the time, he also realized that traditional industries were being poorly served compared to the attention Internet platforms such as short videos and news apps were getting from AI entrepreneurs. To fill the gap, he started Laiye in 2015.

Laiye’s Series C financing came in three tranches, the latest of which recently closed at $70 million, an oversubscription round led by influential Chinese private equity firm Hopu Magnolia. Other investors include Hong Kong-based VMS Group, Chinese private equity firm Youshan Capital, as well as existing investors Lightspeed China and US-based Lightspeed Venture Partners.

Adding Hong Kong-based investment firm VMS Group to the company’s cap table will provide the funds needed for a potential IPO in the city, Wang said. The company does not yet have a timeline for its IPO, but will have early discussions with the Hong Kong Stock Exchange in the coming months.

Start from Paris

Coinciding with the fundraising announcement is Laiye’s acquisition of Paris-based chatbot service provider Mindsay for an undisclosed amount and transaction type. The two met through Cathay Innovation, the startup’s investor, and the acquisition will pave the way for Laiye’s entry into the European market, Wang said.

In Paris, Laiye will assemble a product and engineering team, building on Mindsay’s 30-strong team. Many of the top developer talent in China have become as expensive as their counterparts in Western countries, noted Wang, who has a PhD in machine learning from Princeton. Laiye chose Paris as a springboard to enter the rest of Europe, in part because Mindsay is there, but France itself is also a tremendous source of scientific and technical talent, the founder said.

Mindsay complements Laiye’s flagship product offerings, including conversational AI and robotic process automation (RPA), a technology that mimics repetitive human actions interacting with digital interfaces, such as processing an insurance claim, and a technology that has become popular by New York-based UiPath.

While RPA software is universally adaptable, the success of scaling conversational AI “relies heavily on language processing and data collection, and so RPA globalization cannot happen overnight,” explains Wang. By acquiring Mindsay, Laiye can of course overcome the development challenges of training algorithms for a new language. Wang also saw a strong “cultural alignment” between his company and the French startup led by a team of young founders.

Laiye CEO Guanchun Wang. Image Credits: Layye

Laiye has aggressive goals for global expansion. At present, the company generates only about 20% of its sales outside of China, with customers in Europe, the Americas and Southeast Asia. It aims to increase that ratio to 50% by 2025, after which it is expected to operate multiple technical development centers on different continents. Twenty percent of employees are currently outside of China, but expect this share to reach 50% in a few years.

The startup looks poised to take a crack at the international business front after recruiting a group of international C-suite executives. For example, Ronen Lamdan, the CEO for International Markets, was a former sales director at Microsoft and led the business process automation company WorkFusion in Asia.

Generate income

Turning to operational metrics, Wang said Laiye’s products for both individual and SMB users have already turned profitable, while the segment targeting Fortune 500 customers still requires significant investment in product development and sales.

†[Large corporations] are the biggest opportunity for us,” said Wang, who believed his startup’s competitive advantage is its ability to provide an “integrated” platform that covers the full scope of an employee’s daily routines, from answering calls to processing documents, instead of solving just one process.

Wang declined to disclose his company’s valuation, saying an announcement will be made when it reaches “unicorn status.” Globally, Laiye has nearly 200 major corporate clients and global consultancies as strategic partners, including Deloitte and KPMG. The software suite is available on Microsoft Azure and Alibaba Cloud worldwide, and it features a community of 600,000 developers working on all forms of work automation solutions.

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