Beijing-based Moonshot AI has closed its final private funding round at a $50 billion valuation and filed confidentially for a Hong Kong IPO in early 2027, aiming to raise up to $5 billion. Meanwhile, rival DeepSeek is expanding its latest funding round to as much as $14.9 billion at a $75 billion valuation. Both startups report $1 billion in annualized revenue, commanding steeper multiples than US peers. However, both firms face uncertainty as the Cyberspace Administration of China conducts a data-security probe.
Moonshot AI's valuation and revenue
- ▪Moonshot AI closed its final private funding round at a valuation of approximately $50 billion, up from a $31.5 billion valuation during the summer of 2026.
- ▪Moonshot AI recorded an annual recurring revenue of $300 million in June 2026.
Moonshot AI's planned Hong Kong IPO
- ▪Bank of America is coordinating Moonshot AI's proposed Hong Kong listing, with China International Capital Corporation, Deutsche Bank, and Goldman Sachs acting as sponsors.
- ▪Moonshot AI has filed confidentially for an initial public offering in Hong Kong, targeting the first quarter of 2027 to raise up to $5 billion.
Moonshot AI's founding and backing
- ▪Alibaba Group Holding, Tencent Holdings, and 5Y Capital have participated in multiple funding cycles to support Moonshot AI's expansion.
- ▪Moonshot AI, founded in early 2023 by Yang Zhilin, is backed by Alibaba Group Holding, Tencent Holdings, and 5Y Capital.
Revenue and valuation multiples
- ▪Investors are paying 50 to 74 times annualized revenue for Moonshot AI and DeepSeek, representing a steeper multiple than the valuations of OpenAI or Anthropic.
- ▪Moonshot AI and DeepSeek each report approximately $1 billion in annualized recurring revenue, with Moonshot AI targeting $2 billion by December 2026.
DeepSeek's latest funding round
- ▪DeepSeek is considering expanding its latest funding round to as much as 100 billion yuan ($14.9 billion), double its initial target of 50 billion yuan.
- ▪DeepSeek is seeking a valuation of about 500 billion yuan ($75 billion) for its latest funding round, having closed its first external round in June 2026 at a 350 billion yuan implied valuation.
DeepSeek's investor pool
- ▪DeepSeek is limiting its investor pool largely to government and corporate funds, turning away private investment funds raised from individual investors.
- ▪CATL, Geely Auto, Monolith Management, and Loyal Valley Capital have committed capital to DeepSeek's latest funding round, with Tencent also among the largest backers.
Data-security probe by Chinese regulators
- ▪The Cyberspace Administration of China has opened a data-security probe into both Moonshot AI and DeepSeek over whether they routed sensitive user data to Anthropic's Claude chatbot.
- ▪It remains unclear how the regulatory data-security investigation by Chinese authorities will affect the valuation or IPO timelines of Moonshot AI and DeepSeek.
Debatable claims
- ▪The Chinese government's data-security probe into Moonshot and DeepSeek is justified
- ▪Using a competitor's AI model outputs to train a rival system is ethically acceptable
- ▪Moonshot AI should delay its Hong Kong IPO until the regulatory probe is resolved
- ▪The high revenue multiples of Chinese AI startups are unsustainable
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