Shanghai-based AI startup StepFun, founded in 2023, has raised over 5 billion yuan (~$720M) in a Series B+ round.
The deal marks one of the largest private LLM financings in China to date. StepFun develops multimodal large language models and integrates them directly into end devices — smartphones, vehicles, and robots.
The Details
The twist: Founded by Jiang Daxin (ex-Microsoft VP), StepFun pursues a different path than cloud-centric competitors. Instead of delivering AI only via servers, its models run directly on devices.
Strategy: “AI + Terminals”:
42M smartphones already integrated with StepFun AI
Geely uses StepFun’s voice LLM for smart cockpits
Target 2026: 1M vehicles running StepFun models
👉 Faster response times, less data transfer, deeper integration.
Investor mix: Existing shareholders Tencent, Qiming Venture Partners, and 5Y Capital doubled down. New investors include state-linked funds such as Shanghai SSCI, China Life Private Equity, and Huaqin Technology(smartphone ODM for Oppo and Vivo).
New Chairman: Yin Qi (38), co-founder of facial recognition unicorn Megvii, takes over as chairman. He also leads Qianli/Afari, a Geely-backed smart-driving startup.
Flagship model: Step 3 Multimodal (text + vision), high decoding efficiency. Benchmarks draw comparisons to DeepSeek R1.
Background
Fewer deals, larger tickets: Chinese AI startups closed fewer rounds in 2025 than in the previous year, but average deal sizes increased significantly. The direction is clear – institutional investors are increasingly betting on the combination of hardware and software.
Best example in this case: Huaqin Technology, smartphone ODM for Oppo and Vivo, is investing in an LLM developer for the first time because StepFun is clearly targeting integration into end devices.
👉 Full story: DealStreetAsia, Kr-Asia, Yicai Global
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