Chinese AI startup Zhipu AI has raised over 1 billion yuan ($137.22 million) in fresh funding, following a 3 billion yuan investment secured just months ago. This latest funding round comes as competition in China’s artificial intelligence sector heats up, particularly with the rise of DeepSeek, whose large language models claim to rival Western counterparts at a lower cost.
According to a WeChat statement released on Monday, Zhipu AI’s new investors include state-backed Hangzhou City Investment Group Industrial Fund and Shangcheng Capital. The Beijing-based company plans to use the capital to enhance its GLM large language model and strengthen its AI ecosystem, with a strategic focus on supporting businesses in Zhejiang province and the Yangtze River Delta economic zone.
The investment highlights Hangzhou’s ambition to position itself as a major AI hub. The city, which is also home to DeepSeek, has been actively supporting AI initiatives through state-owned enterprises. Established in 2019, Zhipu AI is regarded as one of China’s leading AI startups, often referred to as one of the country’s “AI tigers.” The company has now completed 16 funding rounds, according to data from business registration platform Qichacha.
Zhipu AI’s fundraising efforts coincide with a shifting AI landscape, as open-source models from companies like DeepSeek disrupt market dynamics for mid-tier AI firms. DeepSeek’s models have drawn attention for their performance, which reportedly matches leading Western AI platforms.
In its latest statement, Zhipu AI announced plans to release a new suite of open-source AI models, including foundation models, inference models, multimodal models, and AI agents.
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