Highlights:

  • The startup will use the funds to enhance its multimodal and reasoning capabilities while launching new consumer-focused products based on its models.
  • Stepfun is the latest Chinese AI model developer to secure millions in funding.

A Chinese developer of generative artificial intelligence models, Stepfun, has raised a hundred million dollars backed by a group of investors including state-owned private equity firms and prominent local tech giants.

The funding round was led by Fortera Capital, the private equity arm of Shanghai’s state-owned Capital Investment Co. The announcement was made recently through a post on the social media platform WeChat, with the news later reported by the Chinese news agency Xinhua. The exact amount of the funding has not been disclosed.

Additional participants in the funding round include Tencent Holdings Co. Ltd., a leading Chinese video games and social media giant, as well as Qiming Venture Partners, an early investor in ByteDance Ltd., the parent company of TikTok, and Xiaomi Corp.

Stepfun, established in April 2023 by Jiang Daxin, the former chief scientist at Microsoft Asia Research Institute, is a Shanghai-based AI model developer. Comparable to U.S. firms like OpenAI and Anthropic PBC, Stepfun is among several Chinese companies aiming to compete in their innovation. Earlier this year, the company introduced its most advanced Step-1V multimodal large language model, featuring over 100 billion parameters, and is currently testing its Step-2 model, which is expected to surpass 1 trillion parameters.

The number of parameters in large language models is a crucial metric, as it reflects their capacity to process complex data patterns and generate more accurate predictions.

The startup announced that it will utilize the funds from this round to enhance its multimodal capabilities, advance the reasoning abilities of its models, and develop new consumer-oriented products built on its foundational models.

Stepfun is the latest Chinese AI model developer to secure substantial funding. Just a week ago, Zhipu AI, another startup in the field, raised an impressive 3 billion yuan (USD 411 million) in a funding round led by several state-backed investment entities, alongside Tencent, Alibaba Group Holdings Ltd., Qiming Ventures, and Legend Capital.

The funding round boosted Zhipu AI’s valuation to over 20 billion yuan, according to reports from Chinese media at the time.