This investment propels the AI company’s valuation to more than $2.7bn. Credit: czfphoto /Shutterstock.

Baichuan AI, a Chinese artificial intelligence startup, has successfully completed a funding round, securing approximately 5bn yuan ($689.6m), reported South China Morning Post.  

Beijing-based Baichuan’s funding round was supported by prominent Chinese technology firms, including Alibaba, Tencent, and Xiaomi.  

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The round also saw participation from state-backed entities such as China International Capital Corporation, the AI industrial investment fund, and Shenzhen Capital Group, a venture fund established by the government of Shenzhen. 

This investment propels the company’s valuation to more than $2.7bn. 

Baichuan, founded in April 2023 by Wang Xiaochuan, former CEO of Sogou, has quickly risen to become the second most valuable AI startup in China, trailing only Moonshot AI, the report said.  

Alibaba, a major e-commerce and cloud services provider, has been particularly active in the AI startup scene, holding stakes in the top four AI companies in the country.  

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The firm is also developing its own large language models, including the Tongyi Qianwen series and an open-source version named Qwen, as it strives to solidify its position in the competitive domestic AI market. 

The latest funding for Baichuan comes shortly after the launch of its new large language model and a dedicated digital assistant, aimed at transforming its Baixiaoying chatbot app into a comprehensive platform for digital life, like Tencent’s WeChat.  

This follows Baichuan’s previous $300m funding round in October, which also included Tencent and Alibaba as investors. 

Chinese technology companies are investing billions in training and developing AI solutions.  

Last year, China established a new $40bn state investment fund for its semiconductor industry to support domestic AI development. The move was in response to US curbs on semiconductor exports to China to rein in Beijing’s AI ambitions.