Chinese Artificial Intelligence startups not delivering enough despite large funding

Chinese Artificial Intelligence startups not delivering enough despite large funding

Artificial Intelligence is one of the areas which will differentiate the winners of tomorrow from the losers.  The countries and societies which focus on this one area will be able to lead over the others.  Much the same way that the countries which focused on science and technology of earlier years did.

Despite USD 6.1 billion in funding in Artificial Intelligence - compared to USD 3.6 billion for US startups - the Chinese companies are not delivering enough, finds research. Click To Tweet

And, this difference will be far more visible in the area of Defence and industry.  Like the Google and Microsoft of today, the new Artificial Intelligence area leaders could be the leading companies of the future and change the economy of those regions.

Large Artificial Intelligence funding but little results

The Chinese startups in the field of Artificial Intelligence have received USD 6.1 bn in funding, while the US companies raised USD 3.6 billion in the same time. And even when the number of startups in China in this field are second only to the US, China is still not winning the AI race.

Lux research did a detailed analysis of China’s AI patents, research papers, venture capital (VC) funding, and related data to find reality. (You can read it here – Lux Research China AI Executive Summary).

Artificial Intelligence

The strange thing is that even though China leads in the volume of patents and papers, when it comes to creating truly innovative technologies much progress has not been made.

Please read this article on how different areas are coming together – How Big Data, Neural Networks and Artificial Intelligence are converging

The work in AI‌ in China has focused on areas like computer vision, voice recognition, and NLP and although they have done a great job in the local market, they have not had a remarkable advantage against their counterparts in Western Europe and the US.


When it comes to innovation, funding is not always easily translatable into great innovation.  Probably some of the main ingredients from research to real products need competition and a social system that has the right delivery systems.  Silicon Valley is a great example of that society of great delivery system.  Since most of the investments and subsidies are by the government, that eco-system is never created in a place like China for Artificial Intelligence startups.

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