Despite Dip in VC Funding, China Adds Ten New AI Unicorns in 2023

In 2023, China witnessed the emergence of ten new artificial intelligence unicorn startups, each valued at over US$1 billion. This development adds to the existing 102 unicorn startups in China’s AI sector, further solidifying its position in the global AI landscape.

This came in the backdrop of a dip in venture financing in AI. As of November 20, 2023, there have been 530 financing events in China’s AI sector in the primary market, a 26% decrease compared to the same period last year; the total financing transaction amount is estimated at 63.1 billion yuan, a 38% decrease from last year, according to IT Juzi.

Generative AI continues to be the focus of investor and entrepreneur attention this year. Despite a general cooling in investment and financing across industries in 2023, financing in the AI sector remains relatively active.

There are four AI unicorns in AIGC and related to large language models, including Zhipu AI, Baichuan Intelligence, 01.AI, and Minimax.

Here are some of the newly-born AI unicorns:

Zhipu AI: Born out of Tsinghua University’s scientific research.
Baichuan Intelligence: A startup project by former Sogou CEO Wang Xiaochuan.
01.AI: A new project initiated by Chinese venture capitalist Kai-Fu Lee.
Minimax: A startup project by a former SenseTime Vice President.
Zhiyuan Robotics: A startup project by a former Huawei engineer.
Mejia Technology: A Startup Project by a Former NIO Vice President

Looking at the various segments within the AI space, there were 152 financing events in the AI field’s infrastructure layer, accounting for 26%; 182 in the technology algorithm layer, accounting for 31%; and the industry application layer had the broadest involvement and the most financing events, with 251, accounting for 43%.

In the past two years, due to significant changes in the overall macro environment and difficulties in AI startups’ IPO plans, the overall financing in the AI industry has been declining.

The peak of AI financing was in 2021, driven by favorable policies, with 1102 disclosed financing events in the domestic AI field, nearly reaching a historical high. Looking further back, the first wave of the AI popularity rose during 2017 and 2018, quickly giving rise to the first batch of AI unicorns in China and globally.

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