According to the Star Daily on December 20 (Reporter Chen Mei), recently, Alibaba's Entrepreneur Fund announced the establishment of an AI Fund with a scale of 0.15 billion US dollars. The fund mainly covers Industries where AI can be deeply applied, including financial services, consumer retail, Medical Care, construction and Real Estate, as well as arts and Entertainment.

Almost at the same time, ByteDance's founder Zhang Yiming also arrived, and his investment institution officially obtained Hong Kong's No. 9 license to start investing in the AI field. In fact, in the large model field, the Doubao launched by ByteDance has already engaged in fierce competition with the Kimi heavily invested by Alibaba.

From the latest actions of the giants and super investors, one investor stated, "The competition regarding this wave of AI trends has gradually spread from large models, AI infrastructure, and algorithms to AI application fields."

Alibaba and Zhang Yiming have all set up Private Equity investment companies and funds in Hong Kong.

From the disclosed information about this fund, the 0.15 billion US dollars AI Fund mainly provides funding and Business strategy guidance for "Hong Kong entrepreneurs," assisting them in expanding their businesses through Alibaba Group's ecosystem to enter the Chinese Mainland and Global markets. In other words, Hong Kong AI entrepreneurs are the main focus of this fund.

Why are Zhang Yiming and Alibaba setting up Private Equity investment companies and funds in Hong Kong to invest in AI?

The above-mentioned investor told the Star Daily reporter, "This is mainly because this year the Hong Kong government has increased support for the Technology field, especially with the introduction of the 10 billion innovation and technology industry guiding fund, which has invigorated many entrepreneurs."

Meanwhile, the IDEATION project at Hong Kong Science Park can provide almost unconditional initial funding of 0.1 million HKD for innovation companies. Additionally, the Hong Kong Quality Migrant Admission Scheme has eliminated the annual quota in 2023, making it easier for entrepreneurs from large companies to gain approval, further reducing the barriers to entrepreneurship.

Recently, a "Global AI Competitiveness Index Insights Report" showed that Hong Kong ranks eighth among the top ten regions in the world for total AI enterprise financing this year.

Regarding the topic of "Starting a business and financing in Hong Kong," several individuals pointed out that Hong Kong's connection to the Global and highly developed Capital Markets, as well as its unique advantage of being backed by the mainland market, make it easier for Hong Kong AI companies to secure financing, which can facilitate the growth of enterprise value.

The Hong Kong government is also increasing its support for the development of AI. The Hong Kong Investment Company, known as the "Hong Kong version of Temasek," has attracted the establishment of AI companies such as Galaxy Universal Robot and Nanfang Black Sesame Group in Hong Kong through investments.

In addition, Hong Kong's startup incubation base—the Hong Kong Cyberport—is also making efforts. This July, at the 2024 World Artificial Intelligence Conference (WAIC), Hong Kong Cyberport led eight community companies to participate, covering AI-driven Internet of Things systems, large language models, image generators, virtual chatbots, sales intelligence and potential client discovery platforms, as well as platforms for children's development and special education.

An industry insider told the 'Star Daily' that against the backdrop of active financing among Hong Kong AI companies this year, it is expected that investment and financing activities in this sector will remain highly active in 2025. "With the continuous progress and maturation of AI technology, as well as the constant expansion of application scenarios, the AI field, especially in large models, automation, and intelligent decision-making, is expected to become a new growth point."

Utilize Hong Kong's status as a 'super connector.'

For big companies, going to Hong Kong to dig for projects is not merely about single investments. Through investments, assisting potential startups to enter the Alibaba Group ecosystem to expand their Business, while consolidating the mainland market, and linking the global market through Hong Kong is the true purpose.

The head of the Alibaba Entrepreneur Fund also expressed the desire to leverage Hong Kong's status as a 'super connector' through collaboration with stakeholders such as Hong Kong Cyberport, Hong Kong Science Park Company (HKSTP), and Hong Kong-Shenzhen Innovation and Technology Park Company (HSITP).

Reporters from the Star Daily observed that before almost simultaneously increasing their private equity investment in Hong Kong, Alibaba and ByteDance had already been 'competing' in areas such as large models, AI infrastructure, and algorithms.

On the investment side, the Alibaba system has been very active this year: on December 11, Zhejiang Alibaba Cloud Computing invested in Sealos, a company that develops and provides cloud-native ecosystem products and services; in August, Zhejiang Alibaba Cloud Computing also invested in the AI platform Dify, which is an open-source LLMOps platform that helps developers create AI applications more easily and quickly.

Earlier, Alibaba Cloud invested in the GPU company Hanbo Semiconductors; Alibaba's strategic investment department invested in a number of companies including Siasun Robot&Automation, Moon's Dark Side, AI e-commerce service provider Connectly, as well as MiniMax.

It can be seen that the Alibaba system continues to strengthen its investment in large models, AI infrastructure, and algorithms. In contrast, ByteDance, although it has not made significant moves in investments this year, has placed emphasis on AI within the company, which has recently surfaced due to a series of business layouts, bringing it into the public eye. With Zhang Yiming's investment institution officially acquiring the Hong Kong license No. 9, ByteDance will undoubtedly follow up with investments.

Wang Yingbo, a scholar in digital economics from Shanghai Academy of Social Sciences, stated during an interview with reporters from the Star Daily that tech giants are investing in AI, which is essentially investing in technology, and technology serves as leverage. On one hand, technology can create immense wealth, while on the other hand, it can also lead to significant disparities.

Artificial intelligence is the most powerful technology of the future and the greatest leverage. Mastering AI means obtaining a ticket to enter future society. For tech giants, investing in AI will become a continuous hotspot in the future, and Alibaba and Zhang Yiming's investment in AI is quite natural. By investing in high-dimensional technology and forming overwhelming advantages in low-dimensional technology, they will accelerate technological and social progress.

Another investor believes that for any startup, it seems impossible to escape the ecosystem of giants in the current market. For instance, in customer acquisition, startups almost cannot avoid the sight of large firms; moreover, the ecosystem of large firms can retain more entrepreneurs and users.

Yuan Shuai, the Deputy Secretary-General of the Beijing Centergate Technologies Internet of Things Industry Alliance, stated to the reporter of the Star Daily that, driven by the continued investment of giants, more innovative enterprises and products are expected to emerge in the AI field. "At the same time, the giants' funds, technology, and market resources will become the best platform to support startups in exploring and practicing in the AI field."