Beijing-based Moonshot AI has closed its final private funding round, at a valuation of about $50 billion, and is preparing an initial public offering in Hong Kong, Euronews reported Tuesday, citing Bloomberg. Rival DeepSeek, meanwhile, has enlarged its own fundraising target as China's leading AI labs line up capital for their next phase.

What Happened

According to Bloomberg, as cited by Euronews and Calcalist, the new valuation is up from $31.5 billion in a round Moonshot raised this summer. The company has filed confidentially for a Hong Kong listing that could raise as much as $5 billion, potentially in the first quarter of 2027.

Bank of America is coordinating the offering, working with China International Capital Corp., Deutsche Bank and Goldman Sachs, Bloomberg reported. Meetings with prospective investors could begin as early as October, though the timing and size of the deal may still change.

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Moonshot's annual recurring revenue has grown from $300 million in June to about $1 billion, and the company expects it to reach $2 billion by December, according to the report. Founded in 2023 by Yang Zhilin, a former Tsinghua University academic who has worked at Meta and Google, Moonshot is backed by Alibaba, Tencent and 5Y Capital. Its Kimi K3 model launched in July.

DeepSeek is now seeking to raise 80 billion to 100 billion yuan, up from an initial target of 50 billion yuan, with Tencent and battery maker CATL as lead investors, Euronews reported. It is aiming for a valuation of 500 billion yuan and is preparing to list on Shanghai's STAR Market, with CITIC Securities advising. The size and timing of that listing have not been confirmed.

Why It Matters

The numbers show how quickly investor money is concentrating in a few Chinese model developers. A jump from $31.5 billion to $50 billion within a few months, backed by recurring revenue that has more than tripled since June, gives Moonshot a growth story to sell to public market investors, and a listing would give it a larger and more durable source of funding for computing power.

The two companies are taking different routes to market. Moonshot is going to Hong Kong, where international banks are running the process and global funds can participate. DeepSeek is pursuing Shanghai's STAR Market, the exchange Beijing has promoted for strategic technology companies, with a domestic adviser and domestic strategic investors leading its round.

Regulatory Overhang

Euronews reported that both companies are under investigation by the Cyberspace Administration of China over allegations involving routing data to Anthropic's Claude models and unauthorized model training.

Moonshot has drawn scrutiny abroad as well. The Primary Wire reported last week on OpenAI's claim that users linked to Moonshot replayed encrypted reasoning data to distill OpenAI's models; OpenAI did not publish evidence for that attribution.

What to Watch

Watch for the start of Moonshot's investor meetings and any public filing that discloses its financials in detail, the final size and valuation of DeepSeek's round, and a timetable for its STAR Market listing. The outcome of the Cyberspace Administration investigations could weigh on the timing of both listings.