The data providers estimate the $30bn figure equates to around 86% of venture dollars invested in China-based AI developers since 1998.
China is beginning to rival US activity in the space in terms of dollars, and the country may overtake its geopolitical rival if it can maintain its momentum.
Data from trade body National Venture Capital Association and deals database PitchBook suggests US-based AI firms raised a total of $51.9bn from 2016 until 2019 – but crucially do not include 2020.
The trajectory would vindicate China’s New Generation Artificial Intelligence Development Plan in 2017, which set out the aim of becoming the world’s leading AI resource by 2030.
According to the strategy, 2020 was supposed to be the year when China’s AI research and innovation matched rivals, including the US.
The government projects China-based AI developers will reach a combined valuation of almost $150bn in coming years and, by 2030, expects China to become the “world’s premier artificial intelligence innovation centre”.
AI is a flashpoint for the entrenched geopolitical feud between Beijing and the US, with the latter pouring funding into military uses of the technology.
In June 2020, the US Department of Defense’s Joint Artificial Intelligence and General Services Administration awarded an $800m contract to tech consultancy Booz Allen Hamilton, aiming to unearth AI-driven efficiencies for its armed forces over five years.
Target areas for the partnership include data labelling – an area where China currently holds the advantage – as well as AI product development and data management.
Europe meanwhile is often recognised as possessing a talented array of AI-focused startups and a strong research base, but it lacks the structure to channel resources strategically in a way that might challenge other economic superpowers.
The European Commission has prioritised AI in its strategy for the next five years, with proposals including bloc-wide and national AI strategies, plus work toward a regulatory approach to govern its ethical implementation.
However the continent must overcome more substantial fragmentation than its peers – including between the 27 EU member states – as well as its historical tardiness in luring venture funding and tendency to trail in terms of competiveness.
According to consultancy Roland Berger, funding to EU-based startups in AI increased more than two-fold to $4.7bn in 2019, with $1.3bn of that amount going to France, and a further $1.2bn heading to the leaving UK. Brexit can only deepen the segmentation in Europe’s digital market.
According to the Carnegie Endowment for International Peace, the EU’s biggest play is likely to be regulation as Brussels seeks to follow up on the digital sovereignty push that has seen it become increasingly insubordinate to the US on issues such as data privacy. But, without cross-continent alignment and closing the venture innovation gap, that is unlikely to be enough.
