BEIJING, March 13 (Reuters) – Chinese artificial intelligence startup Zhipu AI has received a 500 million yuan ($69.04 million) investment from state-owned Huafa Group. This investment follows the recent announcement of a separate 1 billion yuan capital raise earlier this month.
According to the state media outlet Zhuhai Special Economic Zone Daily, Huafa Group, a state conglomerate based in Zhuhai, Guangdong province, recently made its investment in Zhipu. This move is part of a broader trend where Chinese cities are competing to support promising AI startups, a sector Beijing views as critical in its technological rivalry with the United States.
This recent funding follows an earlier 1 billion-yuan funding round led by Hangzhou City Investment Group Industrial Fund, a state-backed entity. Hangzhou is also home to Zhipu AI’s rival, DeepSeek.
DeepSeek’s large language models have gained attention for potentially matching Western competitors’ capabilities while maintaining lower development costs.
Founded in 2019, Zhipu AI is considered one of China’s leading “AI tigers.” Over more than 15 funding rounds, the company has received investment from tech giants such as Tencent, Meituan, and Xiaomi, according to the business registration platform Qichacha.
In July 2024, Qichacha valued the company at 20 billion yuan during a funding round.
The new capital will enable Zhipu AI to further technological innovation and develop its GLM foundation model ecosystem, the Zhuhai Special Economic Zone Daily reported.
In January, the U.S. Commerce Department added Zhipu and its subsidiaries to its export control entity list, which restricts their access to U.S. components.
($1 = 7.2417 Chinese yuan renminbi)
