China's powerful State-backed investors are piling into the country's top artificial intelligence startups, turning the efforts over large language models from a venture capital frenzy into a strategic national move over technological self-sufficiency.

Moonshot AI, a leading Beijing-based startup behind the Kimi chatbot, has added a cluster of State-backed funds and government-linked investors to its shareholder roster, sources confirmed to China Daily.

The new investors include State-owned platforms such as Beijing AI Industry Investment Fund and a State-backed investment fund under Shanghai Guosheng Group, alongside State-owned enterprise telecom giant China Mobile, marking one of the clearest signs yet that China's "national team" is consolidating around a select group of domestic AI champions.

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The move comes as DeepSeek is seeking to raise more than 50 billion yuan ($7.35 billion) in a financing round that could push its valuation above 350 billion yuan, with China's State-backed semiconductor investment fund in talks to lead the deal, according to media reports.

"Such investments extend far beyond commercial returns and also the strategic value of technological self-sufficiency," said Wang Peng, a researcher at the Beijing Academy of Social Sciences. "State-backed investors are increasingly stepping in not just with capital, but with access to computing power, data resources and industrial ecosystems."

Wang pointed to DeepSeek's reported migration onto Huawei's Ascend AI chips as an example of how capital could help domestic AI firms reduce dependence on foreign hardware and software stacks.

On the other hand, Moonshot AI's latest funding round is being led by the venture arm of food delivery giant Meituan.

Since the beginning of 2026, the company has raised more than $3.9 billion in total, making it one of China's fastest-rising AI startups by valuation.

Prior to the latest round, Moonshot AI's shareholder roster already included Chinese internet giants such as Alibaba and Tencent, social media platform Xiaohongshu, as well as major venture capital firms.

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China Mobile's involvement is drawing particular attention among investors and industry experts because of the State-owned telecom operator's massive cloud infrastructure and nationwide distribution network.

"Cooperation between the two companies could eventually embed Kimi's AI agent capabilities into telecom services, giving Moonshot AI access to hundreds of millions of users while securing more stable computing resources," Wang said.

Contact the writers at chengyu@chinadaily.com.cn