A Shanghai-backed investment vehicle has helped artificial intelligence (AI) firm Stepfun raise “hundreds of millions of dollars” in the start-up‘s latest funding round, as more Chinese local governments extend support for the technology‘s domestic development.
Fortera Capital, a private-equity firm under the Shanghai State-owned Capital Investment Co (SSCIC), led Stepfun’s recent series B financing, according to Fortera’s WeChat post on Monday.
Chinese video-gaming and social-media giant Tencent Holdings as well as Qiming Venture Partners – an early investor in ByteDance, Xiaomi and Meituan – also took part in Stepfun’s second financing round, according to a report by Shanghai Securities News, a local financial media outlet owned by Xinhua News Agency.
Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.
Shanghai-based Stepfun, which was founded in April last year, will use the new funding to develop foundational AI models – focused on multimodal capabilities and complex reasoning – and strengthen the start-up’s consumer-oriented product portfolio, according to Fortera’s WeChat post.
The latest initiative by Shanghai’s municipal government reflects the city’s growing efforts to bolster technological innovation in strategically important industries.
Visitors check out artificial intelligence models displayed on multiple screens during the 2024 World AI Conference in Shanghai last July. Photo: Xinhua alt=Visitors check out artificial intelligence models displayed on multiple screens during the 2024 World AI Conference in Shanghai last July. Photo: Xinhua>
In March, mainland China’s commercial and financial hub announced plans to set up a 100 billion yuan (US$13.8 billion) fund of funds to support start-ups in the fields of AI, biotechnology and semiconductors. A fund of funds pools capital into a broader portfolio of investment funds, rather than ploughing money directly into stocks, bonds or other securities.
SSCIC said it is actively implementing a national strategy and aims to foster the development of an internationally competitive AI industry cluster in Shanghai, according to Fortera’s WeChat post.
Stepfun, founded by Microsoft Asia Research Institute’s former chief scientist Jiang Daxin, is one of a growing number of Chinese AI start-ups trying to catch up with innovation by US peers. Stepfun, which launched the Step-1V multimodal large language model with over 100 billion parameters, is testing its Step-2 model that boasts more than 1 trillion parameters.
