Congratulations to METiS Pharmaceuticals on its Hong Kong Stock Exchange IPO — FreeS Fund invested in four consecutive early rounds.
From Whiteboard Equations to the "SpaceX" of Pharma
May 13, 2026 — Hong Kong. METiS Pharmaceuticals (7666.HK), a tech-bio company focused on AI-powered nano-delivery innovation, today successfully listed on the Hong Kong Stock Exchange, becoming the world's first publicly traded AI drug-delivery company and the first AI-driven large-molecule biopharma listing in Hong Kong. With ambitions to become the "SpaceX of pharma," METiS reached this IPO milestone in just six years — the shortest time for any unicorn in China's AI pharmaceutical industry.
FreeS Fund was METiS's first institutional investor, participating across four funding rounds: leading the angel round in late 2019, and making follow-on investments in the angel+ and pre-A rounds in 2020, and the Series A in 2021.
At METiS's listing ceremony, standing to the right of founders Caida Lai and Hongming Chen is FreeS Fund partner Rui Ma. Image: Company provided.
/ 01 /
The FreeS-METiS Story
The story between FreeS and METiS chairman and CEO Caida Lai (Chris) stretches back more than a decade. While still at MIT, Lai launched his first startup — Aqua Fresco, a water treatment project. Thanks to FreeS Fund's emphasis on talent networks at North American universities and the team's frequent trips to the US to scout deals, we had early access to promising projects led by Chinese teams.
Rui Ma vividly recalls a trans-Pacific video call with Lai. It was 6 p.m. Beijing time, 5 a.m. in Boston, and Lai was enthusiastically demonstrating an anti-emulsification adsorption material between two massive water tanks at a pilot plant. The impression Ma took away: this founder had integrity, grit, and vision. Though his years of experience in environmental engineering suggested the water treatment market had limited upside, this founder was worth tracking long-term.
When Feng Li met Lai in Boston, he put it directly: "I believe in you as a person, and your technology is exceptional. But this market is too small — the TAM might only be a few hundred million dollars. If your next project addresses a $1 billion TAM opportunity, I'll definitely back you."
That conversation became the starting point for what followed. In an interview with Cyzone, Lai said this exchange made him realize: "It's not enough to have a great product or great technology — that doesn't automatically make a successful company."
In the summer of 2019, Shuhao Wen, founder of XtalPi — a FreeS portfolio company — pulled Ma and Li into a group chat. "There's an excellent project here," he said, introducing METiS. The pitch deck featured both Lai and Wenshou Wang (co-founder and COO, who had previously led the Inkbit project in Boston) — two entrepreneurs FreeS had already encountered and admired.
Wen offered a strong endorsement: "Chris is a bit like me, but more capable."
After sitting down with Lai, Ma and Li were aligned: regardless of how many others were competing, they had to invest.
Ma's reasoning: from a thesis perspective, the direction was compelling — novel drug formulations represented a major opportunity in both China and the US, and AI and computation were viable paths to differentiation. From a people perspective, the team had cross-disciplinary backgrounds in pharmacy, chemical engineering, and computation, with strong learning ability and a clear commitment to building in Shenzhen. Additionally, XtalPi had already signaled it would collaborate with METiS. Li believed that METiS had unique and solid foundations in formulation technology and data. XtalPi's backing would bring valuable AI+drug screening expertise — a significant advantage. Lai's entrepreneurial track record also spoke for itself.
Though the decision came the same day as the meeting, it took roughly a month to finalize FreeS leading the angel round. In a recent conversation, Ma told Lai, "That waiting period was excruciating. I knew there had to be other competitors making it so hard to lock down allocation."
Though Lai joked, "It wasn't quite that competitive," FreeS actively worked to strengthen its position — maintaining continuous dialogue with Lai while mobilizing the biotech and portfolio teams to connect him with portfolio companies, national formulation center experts, and university professors.
That same year, FreeS became METiS's angel-round investor and secured a board seat. Ma immediately introduced Yuan Gong from Sequoia Capital and Xi Cao to Lai, and METiS quickly closed its angel+ round. Market enthusiasm surged, and the company completed multiple subsequent rounds, building sufficient capital reserves for the industry downturn that would follow. Lai said, "Our judgment at the time proved quite correct. When the market is about to heat up, you have to move fast and accumulate enough ammunition to cross the valley of death."
/ 02 /
From Zero to IPO: Why We Believed in METiS, and What We Learned
In a recent conversation between Ma and Lai, Ma summarized the logic behind FreeS's continued conviction in METiS, and what he learned from observing Lai and the company's journey.
Why METiS
Intellectual foundation — AI × pharma cross-disciplinary innovation. FreeS's strength lies at the intersection of fields, with expertise on both the AI and pharma sides. So when Lai began explaining drug formulations, we immediately understood. We knew novel formulations connect to innovative drugs — a bigger opportunity than polymorph screening.
Technical feasibility — first principles. At the time, everyone was explaining "how to solve data problems through computation" — what we'd today call synthetic data.
Lai sketched an example on a whiteboard: calculating polymorphs is somewhat like computing AAA; calculating formulations is like computing ABC. We immediately grasped his meaning: this would inherently be more complex than polymorph computation, but it was fundamentally doable. Combined with Chen's high-throughput platform and the use of reinforcement learning to reduce dimensionality in formulation calculation, this was a complete and compelling story from day one.
Team composition. Lai pays close attention to people's emotions and details, and he's decisive — essential CEO qualities. Chen had previously developed drugs that reached market in the US. Wang was another entrepreneur we'd previously engaged with, notably mature. The three of them, with chemical engineering backgrounds, mirrored XtalPi's trio of physics backgrounds — an excellent combination.
METiS's position: a framework for three generations of AI pharma companies
- First generation: AI represented relatively early-stage deep learning, still in the early phases of producing actual drugs
- Second generation: Produced good small molecules or bispecific antibodies, but not AI-native — more driven by biotech capabilities
- Third generation: AI-native companies like METiS. And METiS chose an angle synchronized with emerging drug modalities — the growing wave of mRNA, in vivo CAR-T, TCE, gene editing, and other novel therapies. These therapies appear simple (just code programming), but their biggest bottleneck is delivery: how to get that "code" to the right tissue, the right cells, at the right time. METiS is, in our view, one of the most promising companies in this generation.
Founder decision quality
Over the years, Lai has made many critical decisions correctly:
- Returning full-time to China to build the company — A young man from Taiwan who had studied in the US without prior experience living, studying, or working in mainland China, yet he almost immediately made the decision to return.
- Dismantling the VIE structure — When many wanted to preserve their VIE for potential US listings, METiS firmly dismantled theirs.
- Not spinning out LNP — We had discussed incubating a standalone LNP company with Lai, but he decided to keep it internal. Even a slight detour here could have derailed the company's development.
- Pivoting from formulations to delivery — Expanding from improved formulations of existing drugs to a delivery platform compatible with mRNA, in vivo, CAR-T, and all emerging drug modalities. And the LNP vision was present in the day-one pitch deck.
- Full-spectrum fundraising capability — METiS raised from early-stage funds like FreeS and Source Code Capital, then from established dollar funds like Lightspeed, Sequoia, and 5Y Capital, then shifted to insurance capital, and finally took state capital from Beijing and Daxing in the pre-IPO phase. Lai could effectively communicate the company's value and vision to every type of investor.
Learning about investing from investing
Resonance. In early-stage investing, we often hear: "How does an entrepreneur win over investors?" But if we're humble, Ma believes the reverse question matters more — in the earliest stages, how does an investor win the founder's trust? Early-stage investing is mutual selection; resonance between investor and founder is crucial. Ma feels he and Chris were genuinely in sync — both had pivoted from environmental work to biotech. Later, they shared another conviction: they had to make drugs. AI pharma had hype, but ultimately you had to deliver molecules, actually produce medicines. This became an important anchor for FreeS when evaluating AI pharma investments.
Believe, then see. Lai once told Ma: "Many investors truly have to see before they can believe. With you, it's more about believing, and then seeing that we can accomplish this." Lai hadn't really prepared a pitch deck — he drew the principles on a whiteboard for investors. Ma said, "FreeS loves this approach. If you can stand up and draw the first principles on a whiteboard, we can make the decision. First principles matter far more than packaging."
Speaking truth. During that month when Lai was selecting investors, Ma told him something not particularly diplomatic: "With your current capabilities, you can probably build this to a $200-300 million valuation; to reach $1 billion, you'll need to do these things." From Lai's perspective, this was actually a positive — truly good investors don't pander to founders, they genuinely help founders think about their growth. At the time, this also served as "a wake-up call."
Angels run alongside, not grab allocation and leave. When METiS raised subsequent rounds and allocation grew tight, one financial advisor told Lai: "FreeS is an angel-stage investor, you don't need to give them much allocation." Lai later found this wasn't the case — FreeS has been a long-term running partner, discussing strategy, direction, and talent with Chris at many critical moments. This trust isn't built through a single round of investment; it comes from participating in every round, collaborating every time, to earn genuine deep trust that enables open and honest conversation.
Looking back across this decade, Ma's key takeaways:
- Maintain depth in cross-disciplinary research, maintain diligence
- Make decisions and judgments from first principles
- Listen to input, but also hold firm to your own judgment
- Investors must believe more deeply in founders, in technology. METiS is a company we invested in from the first round and accompanied all the way to IPO. This process, rather than being merely an investment story, is fundamentally a journey of mutual trust, mutual learning, and mutual inspiration between founder and investor — a ten-year story walked together.
/ 03 /
FreeS's AI Pharma and AI4S Investment Map
In 2016, FreeS had the good fortune to connect with XtalPi at an early stage; in 2019, we led METiS's angel round and invested across four rounds. Today, XtalPi has become the "first AI pharma stock" on the Hong Kong Stock Exchange (2228.HK), while METiS ranks among the "three rising stars of AI pharma."
Being able to witness and accompany two outstanding companies on this path involves some luck, but also reflects our commitment to researching cutting-edge cross-disciplinary fields and maintaining independent thinking and judgment. When we invested in XtalPi, "AI pharma" was far from the buzzword it is today, but we believed that applying "physics + AI" to polymorph computation could genuinely outperform traditional approaches.
After investing in XtalPi, we began systematically exploring and mapping the full pharmaceutical value chain: after polymorphs came formulations, which METiS has spent the past decade building; moving downstream from molecular design, we invested in ChemIntelli for retrosynthetic analysis and ConMedison for lead compound screening. We also track different drug modalities — spanning small molecules, antibodies, cyclic peptides, RNA (such as Hengyu Bio), as well as delivery and virtual cells (Baiyao Technology). In the era of large model-driven generative AI, in 2024 we led the angel round of IntelliGen AI, a biological foundation model company; in 2025, we invested in Zhongqi Wuliang, a quantum computing company.
Extending the AI pharma paradigm outward: in materials science, we invested in Tuoyin Hesheng; in brain-computer interfaces, we successively backed companies like NeuroXess and Dome Medical; in bio-manufacturing, we have positions in Bluepha, Hesheng Technology, Yanwei Technology, and Xisu Technology. These appear to be entirely different sectors, but we believe they share the same underlying logic — using AI to drive scientific discovery (AI4S).
From AI pharma to the broader AI4S landscape, FreeS's willingness to make systematic bets across these frontier directions — rather than isolated wagers — stems largely from our long-term optimism about Chinese technological innovation as an early-stage investment institution. This has allowed us to meet and accompany entrepreneurs with core moats and global vision. Behind this lies both Feng Li's long-term macro insights and the investment team's commitment to cross-disciplinary research and accumulated cultivation.
Closing Thoughts
Having accompanied METiS from the angel round all the way to IPO, we are genuinely thrilled for what the METiS team has achieved. From that 5 a.m. trans-Pacific call roughly a decade ago, to the candid conversations in Boston, to the angel-round decision made the same day as our 2019 meeting, to METiS's listing on the Hong Kong Stock Exchange today — this is both a highlight moment for METiS and a warm echo of our investment conviction to "believe, then see."
Congratulations to METiS. We look forward to continued innovation in AI-driven drug delivery, fulfilling the ambition to become the SpaceX of pharma, and bringing better treatment options to more patients.
