China’s metropolitan cities, now home to 840 million residents, more people than the entire population of Europe, increasingly rely on technology companies to upgrade their urban infrastructure, with backing from the national and local government levels.
While the category of smart city technology casts a broad net, Beijing-based Terminus Group is drilling down to specific use cases, where sensory Internet-of-Things (IoT) hardware is paired with big data analysis software to improve urban life for city-dwellers. Founded in 2015, the company’s core “AI City” strategy blends IoT hardware with various software platforms to optimize the use of urban spaces for fire prevention, waste management, energy infrastructure, transportation, and more.
With 718,000 5G base stations already scattered throughout China’s largest cities, Terminus Group is set to benefit from the improved connectivity and lower latency, augmenting data collection and transmission ability of the firm’s network of IoT hardware.
KrASIA spoke with Terminus Group’s founder and CEO Victor Ai about the company’s growth story and future goals.
Modernizing the city
Ai hails from a finance background spanning the United States and China. After returning to China in 2008, he noticed cases where big data and machine learning could transform the structure and management of China’s rapidly developing cities. “I had a hunch that there would be many new opportunities in the artificial intelligence industry, given the maturity of the technology and growing demand for its mass adoption in both domestic and overseas markets,” he said.
Terminus leverages digital solutions to improve the livability of urban spaces, monitoring pollution in metrics like wastewater, exhaust gas, and noise. The company also uses its vast network of IoT devices to streamline community and city services, as well as enable better urban management decisions backed by empirical data.
“Cities are much denser and highly developed nowadays. The non-stop urban construction doesn’t fit in 21st-century trends, let alone peoples’ need for public spaces. All of those have changed greatly,” Ai said. “We focus on building more digitalized, organic, environmentally friendly, and tailor-made urban areas.”
The company creates these modern urban spaces by using an over-the-air (OTA) upgrade model, where existing sensors, cameras, and other IoT hardware installed throughout the city can be upgraded remotely, removing the laborious process of manually amending the tech. The backend software can be continuously iterated to create new systems of interactions between the firm’s sensory hardware.
For example, cameras deployed throughout the city can be imbued with computer vision to gather in-depth metrics and use object recognition to alert authorities to accidents. The goal is to create boundless information and data exchange to inform decision-makers about how to best run the city.
Terminus Group’s business is built upon its core analysis platform, which can be connected to an array of IoT devices for various use cases. The company provides its tailored solutions to both public and private sector clients.
For example, Terminus Group offers a fire safety and prevention system, which uses sensors, cameras, and alarms to monitor atmospheric conditions. The system can even act preemptively, thanks to the predictive capabilities of the firm’s software platform that can issue alerts for, say, faulty e-bike batteries that may begin burning. “The AI system will also estimate and detect possibilities of a real fire breaking out and contact the operators to take preventive measures if necessary,” Ai said.
China’s firefighters have been fighting an uphill battle, with only 616,000 registered professional firefighters in the country, compared to over 1.1 million in the US, while government data from 2015 showed Chinese firefighters are four times more likely to be killed on the job than their US counterparts.
Terminus’ major pilot project, Cloud Valley, is currently in operation in southwest China’s sprawling Chongqing.
Terminus Group has outfitted urban spaces in Chongqing with a vast network of IoT devices in public spaces, constantly gathering and relaying data to the company’s city brain TACOS, short for Terminus AI City Operating System. TACOS is the firm’s city hub that serves as a central processing point for data analysis, allowing previously independent layers of the operating system to merge and interact with each other.
With around 30 million inhabitants in the city’s metropolitan area, Chongqing is embracing a modern city model, as the local government is at the forefront of digitizing urban infrastructure in China.
The system aims to improve a key tenet of city governance—the delivery of city services—with real-time sensors able to quickly dispatch emergency services and reduce waiting times when every moment counts.
Terminus Group has benefitted from external market forces, namely China’s state-driven investment in technologies like 5G networks and smart grids, which is set to continue if not accelerate in the wake of viral outbreaks that momentarily suspended all manner of life across the country. “Investments in smart initiatives are expected to rise in the years to come. Because of the pandemic, the investments in digital services will gain even more traction,” Ai said.
New opportunities in the private sector
While much of the company’s software is tailored to the needs of government clients for city management, the firm also services a wide range of corporate use cases in areas like real estate, retail, tourism, and healthcare.
Office buildings outfitted with Terminus Group’s technology can benefit from a reduction in energy and more efficient property management based on data-driven insights, while the company also offers solutions for properties in hospitality and tourism. Computer vision-enabled cameras power the company’s smart retail business, providing clients with behavioral data on users, while also collecting transaction data to create more precise marketing profiles.
Terminus Group recently made its first foray into the international market, appearing as a partner at Expo 2020 Dubai in June, and is currently establishing its first overseas headquarters in the city. The accomplishment marked a proud moment for Ai. “Terminus Group was the only Chinese premier partner of the expo, along with other prestigious companies like Cisco, Nissan, and Mastercard. I wouldn’t say it was easy to get there,” he said.
The firm completed a Series C financing round in August of 2019, securing RMB 2 billion (USD 305 million) from investors including China Everbright and IDG Capital.
While Chinese cities remain a fertile testing ground for the development of Terminus’ technologies, the company has global ambitions, with eyes on markets in the Middle East, Southeast Asia, as well as some Western markets. “Through collaboration with more and more world-class companies, I believe that our vision of the ‘AI City’ will become acknowledged and shared by the global audience,” Ai said.
This article is part of KrASIA’s “Inside China’s Startups” series, where the writers of KrASIA speak with founders of tech companies in the country.