Chinese AI startup Zhipu AI has raised more than 1bn yuan ($137m) in a new funding round, reported Reuters.
The investment round includes participation from the government-supported Hangzhou City Investment Group Industrial Fund and Shangcheng Capital.
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Beijing-based Zhipu AI stated that the funds would be allocated to advancing its GLM large language model and broadening its AI ecosystem, with an emphasis on supporting enterprises in Zhejiang province and the Yangtze River Delta economic region.
The recent investment underscores Hangzhou’s ambition to become a significant AI hub, with the city actively supporting AI ventures through state-owned enterprises.
Zhipu AI, founded in 2019 and recognised as one of China’s “AI tigers,” has completed 16 funding rounds, including a 3bn yuan investment in December 2024 from Zhongguancun Science City.
The funding comes as open-source AI models from competitors such as DeepSeek disrupt market dynamics.
DeepSeek’s models are gaining attention for matching Western platforms’ capabilities at lower costs. In response,
Zhipu AI plans to release new AI models under an open-source framework, including foundation, inference, multimodal models, and AI agents.
Recently, Chinese smartphone maker Honor announced a $10bn investment over the next five years in AI development for its devices.
This move follows a shareholder restructuring in December 2024, marking a step towards a public listing, although no timeline has been disclosed.
In January 2025, reports emerged that China’s ByteDance intends to invest more than $12bn in AI infrastructure throughout 2025.
ByteDance has allocated $5.5bn for AI chip procurement in China, doubling its spending from the previous year.
The company also intends to invest $6.8bn internationally to strengthen its model training capabilities using advanced NVIDIA chips.
ByteDance introduced its AI chatbot, Doubao, in August 2023. By December 2024, it had reportedly become China’s most popular AI application, boasting 71 million monthly active users.
