Alibaba Group Holding has emerged as a major backer of Moonshot AI, one of China’s hottest artificial intelligence (AI) start-ups, holding a 36 per cent stake in the firm, according to the e-commerce giant’s annual report.
Alibaba has “invested a total of approximately US$0.8 billion (about RMB5.9 billion) for an approximately 36 per cent equity interest” in Moonshot AI in the past fiscal year 2024, the company said in its annual report filed with the Hong Kong stock exchange on Thursday.
That values Beijing-based Moonshot AI, also known as Yuezhi Anmian in Chinese, at approximately US$2.2 billion, which is close to the figures reported by local media in February.
Moonshot AI was said to be raising more than US$1 billion at a lofty US$2.5 billion valuation at the time, according to local outlets including 36Kr.
Alibaba, which owns the South China Morning Post, is among a group of Chinese tech heavyweights that have been scrambling to offer a local rival to ChatGPT, ever since that generative AI technology was debuted in November 2022 by San Francisco-based start-up OpenAI.
China tech firms, from search engine giant and AI pioneer Baidu to social media and video gaming powerhouse Tencent Holdings, have gone into overdrive to spawn their own ChatGPT-type products.
Alibaba has backed all of the country’s four new “AI Tigers”, including Beijing-based Baichuan and Zhipu AI, Shanghai-based MiniMax, as well as Moonshot AI, according to start-up data service ITJuzi.com, making it one of the most prolific backers of the country’s future AI champions.
That enthusiasm is also shared by Shenzhen-based Tencent, which has so far invested in three of the AI tigers, save for Moonshot.
Apart from external investments, Alibaba has been working on its own AI models, the Tongyi Qianwen series, that have been used across a range of its own services including its Slack-like online workspace platform DingTalk.
Alibaba CEO Eddie Wu Yongming has emphasised how much the firm values the potential of AI, which was listed as a strategic direction in a shareholder letter Wu co-authored with chairman Joe Tsai on Thursday.
“The second strategic direction is our focus on AI as the single most powerful element that will change and accelerate the growth of our businesses,” the letter said, with AI mentioned 15 times in the more than 1,400-word long document.