Newly formed Chinese artificial intelligence (AI) company Baichuan has raised $300m in funding, reported Reuters.

The financing round was joined by technology giants Tencent and Alibaba.

Baichuan was set up in April 2023 by Wang Xiaochuan, who founded Sogou, an internet search engine.

The investment follows an initial $50m angel round, the company stated on its WeChat account.

Smartphone maker Xiaomi was one of the investors in the initial funding round.

Baichuan, one of the first companies to get Beijing’s approval to deploy a public chatbot in August, is now valued at more than $1bn, according to Bloomberg.

It has since released four open-source large language models (LLM) and is now developing two proprietary platforms.

According to the startup, two of its open-source models have been downloaded six million times.

The startup is one of the leading Chinese companies working on generative AI to compete with US technology majors such as Microsoft and OpenAI.

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

Beijing has established a new $40bn state investment fund for its semiconductor industry to support domestic AI development.

This is in response to US curbs on semiconductor exports to China to rein in Beijing’s AI ambitions.

Earlier this week, Chinese search engine giant Baidu unveiled the latest version of its Ernie 4.0 generative AI model.

In July, Baidu claimed that Ernie 3.5 outperformed OpenAI’s ChatGPT in “comprehensive ability scores”.

Tencent and Alibaba have also launched their LLMs.