Chinese AI startup Baichuan raises $300 million in funding from Alibaba, Tencent, and others

Investment in artificial intelligence (AI) startups continues at a rapid pace with no signs of slowing down as investors pour billions into the space. The most recent addition to this funding surge is the Chinese AI startup Baichuan. On Tuesday, Baichuan announced it had secured $300 million in funding from investors including giants Alibaba and Tencent.

Baichuan’s funding journey began with an initial angel round of $50 million, and this latest round includes investments from Xiaomi, the smartphone manufacturer, and various investment firms, Reuters reported.

Baichuan is one of the many Chinese AI startups aiming to take on OpenAI, the maker of the popular ChatGPT. Late last month, Enflame, an AI chip startup backed by Tencent, announced it had secured $274 million in funding from state-affiliated investors and other sources. However, this funding is minuscule compared to billions raised by US-based AI tech startups. Just a few days ago, we covered the news about Amazon’s substantial move, when the retail behemoth revealed its massive $4 billion investment in the generative AI startup Anthropic.

China’s growing interest in generative AI has spurred a flurry of product launches and funding rounds from both startups and tech industry giants. The competition is driven by the desire to establish a domestic counterpart to Microsoft-backed OpenAI’s ChatGPT. However, investors have cautioned that as cost and profit pressures mount, a shakeout in the sector is looming.

Founded by the former CEO of Sogou, Wang XiaoChuan, who is also the creator of the internet search engine Sogou Inc, Baichuan is a generative AI startup building large language models (LLMs). In June, the company released its first Large-Scale Pre-training Language Model called baichuan-7B with 7 billion parameters.

Baichuan,’s model has been made available on various platforms, including Hugging Face, Github, and Model Scope. It’s noteworthy that baichuan-7B has demonstrated performance across various benchmark tests. In late August, Baichuan was also among the first companies to receive Chinese regulatory approval to release a public chatbot.

Shunwei Capital, a venture capital firm chaired by Xiaomi’s CEO, Lei Jun, participated in this fundraising effort, according to a source familiar with the matter. Baichuan declined to provide further comment, while Shunwei did not respond immediately to a query from Reuters.

On another front, Baidu unveiled its latest generative AI model, Ernie 4.0, claiming that its capabilities rival those of OpenAI’s groundbreaking GPT-4 model. However, some analysts have cautioned that the launch lacks significant innovations compared to the previous version.