According to PYMNTS.com, Chinese AI startup MiniMax is seeking to raise $600 million in a Hong Kong IPO, with plans to start taking investor orders as early as Wednesday, December 31, for a potential January listing. Its rival, Zhipu AI (also known as Z.ai or Knowledge Atlas Technology), aims to raise $552 million in its own Hong Kong IPO. The report notes that Zhipu AI previously raised over 1 billion yuan ($137 million) in a March funding round led by Hangzhou Municipal Construction Investment Group and Shangcheng Capital, with participation from existing backers Alibaba Group and Tencent. This IPO rush comes as global investors are increasingly betting on Chinese AI companies, hoping to find the next DeepSeek and diversify their portfolios, with China fast-tracking tech listings to close the gap with the U.S.
The Race Is On
Here’s the thing: this isn’t just about two companies raising cash. It’s a full-blown sprint to become the first Chinese generative AI startup to go public. That title carries huge symbolic weight. It’s a signal to the market, to Beijing, and to the world about which domestic player is leading the charge against U.S. giants. MiniMax and Zhipu AI are basically neck-and-neck, with their IPO targets separated by less than $50 million. But the competition runs deeper than just IPO size. It’s about models, cost, and backing. Zhipu AI is already touting its GLM-4.5 model series as a cost-effective, open-source alternative that can run on just eight Nvidia H20 chips. That’s a direct shot at the value-for-money narrative that made DeepSeek famous.
Investors Are Hunting for the Next DeepSeek
So why the sudden investor frenzy? Look, DeepSeek caught everyone off guard. It delivered top-tier model performance at a fraction of the expected cost, and that’s a story global funds love. Now, as reported by Reuters, there’s a massive hunt for “the next DeepSeek” in China. Investors are pouring money into these startups, hoping to catch a similar wave of disruptive, affordable AI. It’s a classic diversification play, too. With U.S. AI valuations sky-high, Chinese AI firms look like a different, potentially undervalued bet. And let’s be real, the political push from Beijing to achieve tech independence is creating a powerful tailwind. China is fast-tracking these listings for a reason.
The Bigger Picture: Cost and Hardware
The most fascinating battle here might be the race to the bottom on cost. First, DeepSeek shocked the market with its low-cost models. Then, Zhipu AI turned around and said, “Hold my beer, ours is even cheaper.” This is creating an intense pressure cooker for pricing in the Chinese AI sector. It’s great for adoption, but it squeezes margins and makes the path to profitability that much harder for these IPO-bound firms. And it all ties back to the brutal hardware reality. Mentioning the specific Nvidia H20 chip count isn’t casual—it highlights the intense focus on efficiency due to U.S. export restrictions. Every company is trying to do more with less sanctioned compute power. This entire competitive landscape is being shaped by a geopolitical tech war.
What Comes Next?
I think we’re about to see a flood of capital into this space. If these IPOs are successful, they’ll open the gates for more Chinese AI startups to follow. But it’s a high-risk game. Can these companies turn their impressive research and low-cost models into sustainable, profitable businesses? And how will they navigate the increasingly complex web of international regulations? One thing’s for sure: the center of gravity in the global AI scene is getting a lot more complicated. It’s not just a Silicon Valley story anymore. The action in Hong Kong over the next few months will tell us a lot about who’s really winning in the practical, commercial deployment of AI.
