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Beijing-Backed Chinese AI Startup Draws Global Attention—and OpenAI’s Concern

by Gulnoza Sobirova
June 30, 2025
in SaaS & AI
Reading Time: 3 mins read
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Beijing-Backed Chinese AI Startup Draws Global Attention—and OpenAI’s Concern
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In a rare move, OpenAI has publicly highlighted a lesser-known Chinese AI company that it believes is playing a pivotal role in China’s push to become a global AI superpower. The company in question: Zhipu AI, a Beijing-backed startup that OpenAI says deserves closer international scrutiny.

Founded in 2019, Zhipu AI is often grouped among China’s so-called “AI tigers”—a class of homegrown large language model (LLM) unicorns tasked with helping Beijing reduce its dependence on American AI technologies.

While DeepSeek, another prominent Chinese AI player, has garnered more international media coverage thanks to its recent R1 model launch, OpenAI’s latest blog post suggests that Zhipu AI is emerging as a serious competitor on the global stage.

According to OpenAI, Zhipu AI has received over $1.4 billion in state-backed investment, with support coming from various Chinese local governments. The company’s leadership, OpenAI says, has held frequent high-level engagements with Chinese Communist Party officials, including Premier Li Qiang.

Zhipu AI’s global ambitions are also expanding rapidly. The company reportedly has offices in the Middle East, the United Kingdom, Singapore, and Malaysia, and is spearheading joint “innovation center” projects across Southeast Asia, including initiatives in Indonesia and Vietnam.

OpenAI suggests that these moves align with China’s broader “Digital Silk Road” strategy, which aims to embed Chinese technology standards and infrastructure in emerging markets before American or European competitors can establish a foothold. “The goal is to lock Chinese systems and standards into emerging markets while promoting a narrative of responsible and transparent AI,” OpenAI wrote in its blog.

So far, Zhipu AI has not publicly responded to OpenAI’s comments. However, speaking to Chinese media last week, Liu Debing, Chairman of Zhipu AI, stated that the company’s mission is to “contribute China’s AI power to the world.”

The U.S. government appears to view Zhipu AI with growing suspicion. In January 2025, the U.S. Commerce Department placed the company on its Entity List, citing national security concerns over Zhipu AI’s alleged support for the Chinese military’s AI modernization efforts.

While Zhipu AI is expanding its international presence, OpenAI is also strengthening its global position. During a May visit to the UAE, President Donald Trump announced more than $200 billion in new commercial deals, including plans for Stargate UAE, a major AI campus backed by OpenAI, Oracle, Nvidia, and Cisco Systems, expected to open in 2026.

In parallel, OpenAI recently secured a $200 million contract with the U.S. Department of Defense to deliver AI tools, and launched its new “OpenAI for Government” initiative to bring its services to U.S. public sector workers.

Meanwhile, Zhipu AI is reportedly exploring an initial public offering (IPO), with previous valuations placing the company at around 20 billion yuan ($2.78 billion), according to local media reports.

As competition between the U.S. and China intensifies in the AI sector, Zhipu AI’s global expansion—backed by Beijing’s financial and political support—signals that the international race for AI dominance is far from over.

Prepared by Navruzakhon Burieva

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