On December 5th, Zhu Xiaohu, the managing partner of Jinsha River Venture Capital, responded to the recent arbitration case initiated by some investors of Loop Intelligence against the founder Yang Zhilin and co-founder and CTO Zhang Yutao of Moonshot AI in Hong Kong.
He stated that Moonshot AI was originally a project developed internally by Loop Intelligence for two years and has yet to receive formal approval from Loop Intelligence's shareholders. Zhu further clarified that this dispute involves not only the issue of the waiver letter but also delays in board resolutions and conflicts of interest.
It is understood that Moonshot AI was established in March 2023 and launched its flagship product Kimi in October of the same year, quickly gaining market attention and even surpassing Wenxin Yiyan to become a hot topic in the industry. However, Yang Zhilin and Zhang Yutao initiated fundraising and established Moonshot AI without obtaining the consent waiver from Loop Intelligence's investors, triggering a strong reaction from investors.
Zhu Xiaohu clearly pointed out in a post on social media that Moonshot AI is not a sudden new project but rather a technology that has been developed internally by Loop Intelligence for two years. Despite the spin-off having been a long time coming, the shareholder resolution of Loop Intelligence has not been signed until January of this year. However, a certain director (Zhang Yutong) is suspected of concealing a conflict of interest, which may render this resolution invalid.
In addition, Zhu revealed Zhang Yutong's actions within Loop Intelligence, where he deliberately concealed the large number of shares (9 million shares, approximately 14% of the initial shares) he obtained in the newly spun-off company, which violated his fiduciary duty to the fund partners and shareholders, ultimately leading to his dismissal by Jinsha River.
The core controversy of this arbitration storm revolves around Yang Zhilin and Zhang Yutao starting fundraising and establishing Moonshot AI without obtaining the consent waiver from Loop Intelligence's investors. Although Moonshot AI has commissioned a lawyer to handle the matter, and the attorney stated that they will defend themselves legally, this incident also reveals the complexities faced by Chinese startups in terms of spin-offs and shareholder rights and responsibilities, becoming a classic case in venture capital history.
As a rapidly growing company, Moonshot AI achieved a valuation of up to $3.3 billion thanks to a series of financing and technological breakthroughs. However, behind this capital feast, some "old shareholders" who failed to profit expressed dissatisfaction with the equity arrangement between Loop Intelligence and Moonshot AI, ultimately leading to the outbreak of this investment dispute.