In a significant leap towards the capital markets, Ganfei Intelligent Technology Co., Ltd., a new entrant in China's graphic processing unit (GPU) landscape, is gearing up for an initial public offering (IPO). As of February 7, the company has successfully received approval for its IPO guidance registration, with Haitong Securities acting as the advisory institutionThis marks Ganfei as the fourth GPU enterprise in Shanghai within just a year to undertake this crucial step, following the likes of Suiryuan Technology, Birun Technology, and Muxi.

Founded in 2020, Ganfei originated from the GPU division of the esteemed Shanghai chip unicorn, ZhaoxinIt is noteworthy to mention that Ganfei's GPU development lineage can be traced back to S3 Graphics, an influential player renowned as the "GPU King" prior to Nvidia's dominanceThis historical connection may provide Ganfei with both technological insights and a unique identity as it embarks on its market journey.

With aspirations of revitalizing its legacy in the GPU arena, many are left to ponder whether this longstanding manufacturer can emerge anew in the bustling Shanghai market.

S3 Graphics was established in 1989 and was a prominent contender during the 1990s, especially famous for its Trio series of graphics cardsHowever, as the 3D graphics revolution commenced, S3 struggled to pivot and adapt, ultimately losing ground to faster-moving competitorsThe acquisition of S3 by the rapidly growing VIA Technologies in 2000 spelled further changes; S3 exited the desktop graphics card space focusing instead on mobile markets and integrated display chipsSadly, this meant they were on a slow path towards obscurity.

The turnaround for S3 materialized in 2013 when VIA formed a joint venture with the Shanghai local government, giving rise to Shanghai Zhaoxin Integrated Circuit Co., LtdEnabled by a partial inheritance of VIA's X86 patents and the acquisition of S3’s former GPU teams, Zhaoxin launched a domestic CPU and GPU production initiative

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This marked a significant shift in the Chinese tech landscape, enabling local alternatives to take root in a field previously dominated by foreign entities.

By 2020, Zhaoxin decided to reallocate resources, and thus, Ganfei was born out of its GPU divisionPositioned to address a variety of challenges across sectors like computing, autonomous driving, online gaming, and smart workplaces, Ganfei aims to provide integrative graphic image and AMOLED display driver solutions.

Ganfei possesses end-to-end core technologies in graphics imagery and AMOLED display driving solutionsWhat sets them apart is their independent product architecture that stands apart from Western counterpartsTheir focus on complete autonomy encompasses aspects from architecture through algorithm development to implementation, making the entire process secure and manageable.

The company's display solutions include driver chips, showcasing versatility across multiple devices such as smartphones, tablets, smartwatches, laptops, and desktop monitorsWith extensive experience in mass-producing chips, Ganfei is not just pioneering innovation; they're building a full-fledged framework for GPU product design that includes frontend and backend development, system engineering, software, and testing.

According to reports, Ganfei has recently launched its first independent GPU chip catered to mid to high-end applications in desktop, commercial displays, and general computingBuilt on a 28-nanometer process, this chip integrates a newly developed graphic image processing engine and achieves compatibility with major operating systems, including Kylin KOS, Tongxin UOS, and Windows platforms.

However, despite Ganfei's promising technologies, the company is still relatively nascent in the commercial landscape and faces hurdles in establishing a strong marketplace positionJoining the ranks of GPU unicorns such as Suiryuan Technology, Birun Technology, and Muxi on the road to IPO is a testament to its ambition and potential revival as a major player in the GPU domain.

Further compounding the excitement is that Ganfei, having completed two rounds of funding, boasts a diverse set of notable investors, including Junlian Capital and Kunqiao Capital, with Alibaba's Yunfeng Fund also joining the table

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In September 2021, a strategic financing round saw notable contributions from these players, followed by a series A funding round in December 2022, effectively boosting Ganfei's stature and resources as it plans the next steps in its corporate lifecycle.

Interestingly enough, Ganfei currently does not have a controlling shareholder; rather, Zhaoxin holds the largest stake at approximately 27.4%, followed by Yunfeng Fund's 13% and Junlian Capital, which has cumulatively invested around 10.1% over various funding roundsThese financial discussions place Ganfei in a promising light, particularly considering Zhaoxin's recent move towards IPO guidance registration, establishing a valuation of approximately $17.1 billion, which was subsequently recognized in the 2022 GEI Chinese Unicorn Companies List.

This backdrop raises the question of valuation dynamics as Ganfei navigates itself in the competitive GPU sectorWith the recent surge in domestic GPU companies, including notable names launching IPOs, Shanghai has emerged as a hotspot for innovation in the technology sectorAmong five GPU players initiating guidance registration since last summer, four hail from Shanghai, indicating a robust ecosystem and an increasing momentum towards local advancements in GPU technology.

The dawn of the domestic GPU era began in earnest post-2017, marked by extensive investments leading to the formation of multiple startups around 2020. Companies like Birun Technology, Muxi, and Ganfei are just a few that have made their mark, collectively forming a vibrant GPU landscape in Shanghai, which outpaces other regions, synthesizing innovation with local investment initiatives.

In essence, as Ganfei strides towards its IPO amid the vigorous competition and evolving GPU market, it stands at a critical junctureIts historical roots combined with modern ambitions among trendsetting counterparts could position it uniquely to either reclaim its former glory or carve out a niche in the current technological renaissance sweeping the industry.

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