Two more Chinese AI players prepare for IPOs, but the burn rate is high

Zhipu and MiniMax are planning Hong Kong IPOs as filings show high cash spending and US chip limits, with pressure to list early before US AI giants go public in 2026 and attract global investors

Two major Chinese artificial intelligence startups, Zhipu AI and MiniMax, have filed applications to list on the Hong Kong Stock Exchange, Nikkei Asia reported. Both companies are among China’s best-known AI firms, but their financial filings show that growth in the sector comes at a heavy price.

 

Over the past three years, the two startups together have spent about 11 billion yuan ($1.6 billion), with nearly half of that amount going toward renting computing power to train their AI models.

 

Despite strong revenue growth, both companies expect to remain loss-making for the near future. Zhipu plans to raise around $300 million through its listing, while MiniMax is reportedly seeking up to $700 million, the news report said.

 

 

Pressure to list before US AI IPOs

 

There is strong pressure for Zhipu and MiniMax to go public as soon as possible. The expected listings of US AI giants such as OpenAI and Anthropic in 2026 are likely to attract significant global investor attention and liquidity, the news report said.

 

Once those large US offerings hit the market, smaller companies -- including Chinese firms -- may find it harder to stand out or secure funding at favourable valuations.   

 

Zhipu’s academic roots and US blacklisting

 

Zhipu, officially known as Knowledge Atlas Technology and marketed overseas as Z.ai, was founded in 2019 by Tsinghua University professors Tang Jie and Li Juanzi. The company has attracted backing from major Chinese firms including Meituan, Tencent and Ant Group.

 

In January 2025, Zhipu was added to the US export control Entity List over claims that it was involved in “advancing the PRC's military modernisation", a reference to China’s People’s Liberation Army. Zhipu said the listing “will not cause any material adverse effect” on its business or finances, but warned that further US restrictions could hurt operations.

 

Current US export rules prevent some Chinese companies from directly buying advanced chips. However, many firms have found workarounds by renting computing power from cloud providers such as Microsoft and Amazon Web Services in regions like Southeast Asia and West Asia. US lawmakers are now pushing to close this loophole, which could further increase costs for Chinese AI companies, the news report said.

 

MiniMax’s consumer-focused strategy

 

MiniMax was founded in Shanghai in 2021 by Yan Junjie, a former researcher at SenseTime, which is also under US sanctions. Its investors include Alibaba, Tencent, miHoYo and IDG.

 

Unlike Zhipu, MiniMax focuses more on consumer products. About 65 per cent of its revenue comes from individual subscribers to its visual content platform Hailuo AI and virtual companion app Talkie, known in China as Xingye. These platforms face intense competition in the domestic market.

 

MiniMax has aggressively expanded outside China, sharply reducing its reliance on the mainland market. In the first nine months of 2025, Singapore and the US contributed 24.3 per cent and 20.4 per cent of revenue, respectively. Mainland China’s share fell to 26.9 per cent, down from 81 per cent in 2023, the news report said.

 

However, the company faces legal challenges in the US. In September, major Hollywood studios including Disney, Universal and Warner Bros. Discovery sued MiniMax over alleged copyright violations by Hailuo AI, seeking damages of up to $75 million.   

 

Heavy losses continue

 

Both firms are still burning cash. In the first half of the year, Zhipu’s revenue jumped 325 per cent year-on-year to 191 million yuan, but its loss widened to 2.4 billion yuan. Research and development spending alone reached 1.6 billion yuan. Zhipu plans to allocate 70 per cent of its IPO proceeds to R&D.

 

MiniMax reported $53 million in revenue and $512 million in losses in the first nine months of the year. It spent $180.3 million on R&D and plans to use fresh funds to build AI-native products.

 

Even as losses mount, Chinese AI company valuations remain far below those of US peers. Zhipu has raised over 8.3 billion yuan since 2019 and was last valued at about 40 billion yuan ($5.6 billion). MiniMax was valued at over $4.2 billion after its August fundraising, the news report said.

 

By contrast, OpenAI could reach a valuation of $830 billion if it completes a $100 billion fundraising round, while Anthropic is valued at around $350 billion following major investments from Microsoft and Nvidia.