Alibaba-backed AI startup Moonshot AI hits $4.8B valuation in new funding round

Alibaba-backed AI startup Moonshot AI is closing a new funding round that values the Chinese startup at $4.8 billion, CNBC reported, citing two people familiar with the deal. The round comes just weeks after the company was priced at $4.3 billion in December, showing how quickly investor interest is heating up in China’s AI sector.

Moonshot AI is best known for Kimi, its flagship chatbot built on a family of in-house large language models. The first version launched in 2023 and quickly stood out for its unusually long memory window, supporting up to 128,000 tokens of context. That feature made it popular for long-form analysis and document-heavy tasks.

The company raised the bar again in July 2025 with the release of Kimi K2, an open-weight model that delivered strong results on coding benchmarks. The update signaled Moonshot’s growing technical depth and its push to compete at the model level, not just the application layer.

From Chatbot to Billion-Dollar Startup: Moonshot AI Hits $4.8B Valuation

Kimi surged in popularity in China months before DeepSeek entered the market last year, helping Moonshot gain early traction in the country’s fast-moving AI race. That momentum has translated into strong investor demand. One source said the latest funding round could wrap up soon due to heavy interest from backers eager to gain exposure to leading Chinese AI startups.

The sources told CNBC that Moonshot is finalizing a new funding round that would push its valuation at least $500 million above its December mark. One source also told CNBC the deal is expected to close soon, driven by strong investor demand.

Both sources asked to remain anonymous due to the private nature of the talks. Moonshot AI did not respond to requests for comment before publication.

People close to the deal say this may just be the beginning. If market appetite holds, future rounds could push Moonshot’s valuation even higher. That optimism is tied to a broader wave of excitement around Chinese AI companies that are lining up for potential IPOs.

The surge comes at a time when U.S.-based chatbots such as OpenAI’s ChatGPT remain officially unavailable in mainland China. Beijing restricts access to many American internet services, and Washington has tightened rules around U.S. firms doing business with Chinese tech companies. Those barriers have created space for domestic players to dominate their home market.

Moonshot’s previous funding round closed on December 31. That raise included participation from IDG, Alibaba, and Tencent, according to Chinese financial outlet LatePost. The company has yet to comment on any plans for a public listing.

Rivals are already seeing strong results in the public market. Zhipu, listed in Hong Kong under the name Knowledge Atlas, closed on Monday at a market value of about $13 billion, according to Wind Information data. MiniMax isn’t far behind, trading at roughly $15.2 billion.

For investors watching China’s AI race, Moonshot’s rising valuation signals one thing clearly: local champions are attracting serious capital, and the competition to back the next breakout player is getting intense.