Alibaba-backed robotics startup X Square Robot raises $100M to build humanoid robot butlers

The race to bring humanoid robots into everyday life is accelerating, and one of China’s youngest players just pulled in a big check. Shenzhen-based humanoid startup X Square Robot announced Monday that it raised around $100 million in fresh funding, a round led by Alibaba Cloud with participation from heavyweights including HongShan (formerly Sequoia Capital China), Meituan, Legend Star, Legend Capital, and INCE Capital.

It’s the company’s eighth funding round since launching less than two years ago in December 2023. The new investment brings its total haul to about $280 million, according to Chief Operating Officer Yang Qian, who spoke with CNBC.

Alibaba’s involvement signals how deeply China’s largest tech companies are betting on robotics as the next wave of consumer and enterprise tech. According to Bloomberg, Alibaba has earmarked $53 billion for AI infrastructure over three years as part of a major pivot, with humanoid robots seen as a centerpiece of that strategy. Beijing, too, has flagged robotics as a national priority.

“The Hangzhou-based company has said it plans to spend $53 billion on AI infrastructure over three years in a major pivot. Artificial intelligence advancements promise to usher in a new generation of smarter robotics, and Beijing has made developing that sector a national priority,” Bloomberg reported.

Betting on AI-driven humanoids

Venture capital money has been pouring into humanoid robotics on the belief that pairing machines with generative AI will finally let them move beyond basic tasks. “Right now, we need robots to operate and complete complex tasks autonomously,” Yang told CNBC in Mandarin, which the outlet translated into English.

For decades, robots struggled to go beyond simple actions like picking up objects. AI, Yang said, is what makes the leap possible. To push things further, X Square Robot unveiled an “open-source foundation model for embodied AI” called Wall-OSS, which it claims is the first of its kind for robotics. The goal is to give developers and researchers free access to the core code, hoping to accelerate progress toward practical humanoid helpers.

The company expects “robotic butlers” could be a reality within five years. That’s an ambitious claim—CNBC said it couldn’t verify it—but it speaks to the level of confidence Chinese startups now have as they try to set the pace in robotics.

X Square Robot: From open-source to real hardware

The funding announcement coincided with the debut of Quanta X2, X Square Robot’s latest humanoid. It comes with hands sensitive enough to detect subtle pressure changes and can be fitted with mop heads for full-sweep cleaning. The company doesn’t yet have a product ready for mass-market rollout. Pricing depends on use case, though research firm Humanoid Guide pegs the cost of one unit at around $80,000. Rival Unitree already sells a humanoid for $16,000, though its capabilities are less clear.

Yang said the sweet spot for consumer adoption is closer to $10,000 per unit, and she expects hardware costs could fall enough to reach that mark within three to five years.

Looking ahead

For now, revenue is coming from institutions. X Square Robot has already sold units to schools, hotels, and retirement homes, and is starting conversations with customers in Japan and Singapore. The company also plans to prepare for an IPO next year, though Yang said no listing venue has been chosen.

Hardware aside, Yang admitted that AI for robots still trails far behind what’s been achieved in text and code generation. She doesn’t expect humanoid AI to hit ChatGPT 3.5-type performance for at least a year. The benchmarks for “embodied AI” remain murky, making progress harder to measure.

Still, China is moving fast. With Nvidia chips handling the heavy compute and local automotive chips covering other functions, X Square Robot is tapping both global and domestic supply lines. Coupled with the surge of interest in open-source AI, the startup is positioning itself as one of the frontrunners in a field that’s edging closer to real consumer adoption.