China's AI 'Tiger' Startups are Building Models and Products

Hello Everyone,

Can you name the best AI startups in China?

Lately I’ve been thinking more about the pace of Generative AI’s improvements, innovations, applications and new models.

In 2024 while Western Generative AI startups are getting acquired or pivoting (consolidation) and while the Western media is of course glorifying individuals, there is another side to this frantic pace of innovation and research that too often goes neglected. In a nutshell, it’s China. China’s LLM ecosystem is just getting started, while in Silicon Valley early stage consolidation is rapidly pruning startups already! It’s the speed that kills. ??

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What I’m noticing in 2024 is how fast Chinese AI Startups and its BigTech BAT (Baidu, Alibaba, Tencent) investments are making significant progress, which we rarely hear about. But who are they? What do we know about them? Google or Reddit aren’t adequate places to find this sort of information.

I asked Tony Peng of Recode China AI to look into China’s top Generative AI startups for us. The Chinese AI community on Substack is only now in mid 2024 slowly starting to come into its own.

Visit Tony Peng’s Newsletter: Recode China AI ?? for more insights about China’s emerging AI ecosystem.

China’s text-to-video and Visual Reasoning Models will achieve Parity in 2025

• In the past few days, Alibaba Cloud released Qwen2-VL, that is designed to understand videos longer than 20 minutes, among other things, see the Github. Follow Qwen on X here.

Blog: https://qwenlm.github.io/blog/qwen2-vl/

GitHub: https://github.com/QwenLM/Qwen2-VL

HF: https://huggingface.co/collections/Qwen/qwen2-vl-66cee7455501d7126940800d

ModelScope: https://modelscope.cn/organization/qwen

• China is especially strong in text to video AI. Zhipu also released a video call real-time chabot feature. The new feature called Qingyan, allows users to engage in real-time video interactions with the AI. GLM-4 Plus by Zhipu has advanced capabilities in language comprehension, image and video understanding, and multimodal processing. It includes several sub-models such as GLM-4V-Plus for video understanding and CogView-3-Plus for image generation.
• MiniMax for their part also recently released a text-to-video product. MiniMax Video-01 produces videos in HD with a resolution of 1280x720 pixels at 25 frames per second.

By the late 2020s I actually think China will be ahead in many aspects of text-to-video, text-to-action related to video and Visual reasoning. For this reason I also expect them to win in the future of bleeding edge races to text-to-gaming and some aspects of text-to-action and Agentic AI. That being said, not everyone is as bullish about China’s AI startups as I am given the pull-back of foreign investments and more difficulty for them in obtaining AI datacenter access. On the contrary I think these externally imposed bottlenecks force them to innovate.

China’s Top Enterprise LLM Firms

According to market research firm International Data Corporation (usually called IDC), Chinese artificial intelligence (AI) giants Baidu and SenseTime (not so long ago a startup itself), along with startup Zhipu AI, are the country's biggest providers of business-facing large language model (LLM) service.

1. Baidu - 19.9% marketshare
2. SenseTime - 16% marketshare
3. Zhipu AI
4. Baichuan
5. 4Paradigm

In terms of research we always have to consider as well the Beijing Academy of AI (BAAI) and the prolific AI consumer app builder ByteDance. Even as OpenAI is working with Broadcom to design an AI chip, so are they. ByteDance was featured heavily in a16z’s (August 21st) last Consumer AI update, and that’s for a reason. ByteDance has no fewer than six apps related to Generative AI on the top charts list. Nobody is as prolific and able to scale consumer AI apps than the TikTok maker ByteDance. Bytedance launched an R&D division, Flow, focused on generative AI applications in late 2023, and has been debuting new AI applications in the U.S. (and abroad) under other corporate names since early 2024.

In mainland China, I noticed that Baidu serves now half of China's state-owned enterprises for "AI innovation". The company's Ernie LLM-based enterprise-facing platform Qianfan is now serving 150,000 clients and has helped them develop 55 original applications, according to their PR. ERNIE actually stands for Enhanced Representation through Knowledge Integration (paper) and many in the west have never even heard of it. But Baidu claimed in April, 2024 that it has 200 million active users, the same as ChatGPT’s 200 million weekly active users reported as of August.

Who are China’s Top Generative AI Startups?

I am tracking several Generative AI startups out of China, here are the ones I consider the real “AI Tigers” ?? of this new generation of companies.

• Zhipu AI
• MiniMax
• Moonshot AI
• Baichuan AI
• 01.AI

(SCMP got it wrong, there aren’t 4 but 5 and may be more).

Tony outlines about 8 of the top AI startups in terms of Generative AI prowess as of August, 2023.

To read the full post go here.