The archive · AI & Models · Strategic decision · 2024–2026
Kling: Kuaishou's ~$3B bet that video-gen AI can stand alone - 100M users, HK IPO ahead
Kuaishou's Kling (video generation, June 2024) passed 100M global users, then raised ~$2.8B toward a $3B pre-IPO round at about $18B.
Kling AI · Kuaishou Technology (快手)
What the business is
Kling AI is a video-generation model and creator studio - text, image and video to video - launched by short-video giant Kuaishou in June 2024 and sold to creators and businesses through subscriptions and API.
Starting capital：About $2.8B raised toward a planned $3B third-party allotment announced in Kuaishou's 2026-07-02 Hong Kong exchange filing (CNBC, Seoul Economic Daily); Tencent invested $200M and Alibaba Cloud ¥1.363B.
How it started
Kling launched in June 2024 inside Kuaishou, China's second most popular short-video platform, which CNBC says has about 700 million monthly users spending more than 130 minutes a day. Viral clips - a dancing dog, a 'ballpark goddess' - put the model on global feeds, and Kling began charging creators and businesses through subscriptions and API.
What happened
By mid-2026 Kling counted more than 100 million global users and about 50,000 corporate clients, with roughly 70% of revenue from overseas subscriptions and API and Q1 2026 revenue above ¥650M (+300% YoY). On 2026-07-02 Kuaishou filed with the Hong Kong exchange to raise up to $3B from outside investors; within days about $2.8B was committed - Tencent $200M, Alibaba Cloud ¥1.363B, with Baidu and CPE also among backers - valuing Kling at about $18B, the highest for a standalone video-AI company, and cutting Kuaishou's stake from 100% to about 68%. Kuaishou called it a pre-IPO round with a Hong Kong listing expected within 12 months.
How it ended up
The spin-off is in progress as of 2026-09-02: once the round closes, Kling becomes a separately owned company about 68% held by Kuaishou, with a Hong Kong IPO expected within 12 months of the July 2026 filing.
Background
Kling AI is Kuaishou's video-generation business, launched in June 2024 inside China's second most popular short-video app - a platform CNBC says has about 700 million monthly users spending more than 130 minutes a day. The bet was that video generation could be its own company: Kuaishou's knowledge of what looks real, plus a B2B revenue model, rather than a research lab attached to a bigger group.
The model went global through virality - a dancing dog and a 'ballpark goddess' were the clips Seoul Economic Daily credits - and then through contracts: by June 2026 Kling reported more than 100 million users, about 50,000 corporate clients, roughly 70% of revenue from overseas subscriptions and API, and Q1 2026 revenue above ¥650M, up more than 300% year on year.
On 2026-07-02 Kuaishou filed with the Hong Kong exchange to raise up to $3B from third parties, describing it as a pre-IPO spin-out round. About $2.8B was committed within days, including $200M from Tencent and ¥1.363B from Alibaba Cloud, with Baidu and CPE among other backers. The process valued Kling at about $18B - the highest among standalone video-AI companies - and cut Kuaishou's stake from 100% to about 68%, with a Hong Kong IPO expected within 12 months.
What has to be true
- Kling is winning on commercial use, not just virality: ~50,000 corporate clients, ~70% of revenue from overseas subscriptions and API, and Goldman Sachs rating it ahead of Seedance for B2B.
- The round doubles as a hedge by China's giants: Tencent, Alibaba and Baidu all invested in Kling rather than let ByteDance's Seedance own the video-AI category early.
- Kuaishou's 700M-user short-video base is the training edge - the dancing-dog and 'ballpark goddess' demos came from knowing what looks real - so a spin-out starts with distribution most labs lack.
- The capital needs are visible: Kuaishou's 2026 capex plan of ¥26B, most of it for Kling infrastructure, exceeds the entire raise, and investors received a put option if no IPO closes before 2031.
What can be applied
Distribution gave Kling a head start - Kuaishou knew what looks real - and B2B revenue made it fundable; the test is whether standalone video AI outruns the ~¥26B capex it needs.
Aftermath
As of 2026-09-02, Kling is still inside Kuaishou; when the round closes the stake falls to ~68% and a Hong Kong IPO is expected within 12 months of the July 2026 filing. Kuaishou plans ¥26B of 2026 capex, mostly Kling infrastructure - the ~¥21.5B ($3B) raise is less than a year of that plan (Seoul Economic Daily). ByteDance plans ¥200B of 2026 AI infrastructure behind Seedance, and Alibaba - also an investor - hired a former Kling CEO for its rival video model Happy Horse. The 100M-user and ¥650M-quarter milestones are real; the standalone test has only begun.
Sources
- China's Video AI Leader Kling Raises $3 Billion to Battle Seedance
- Kuaishou shares jump after Tencent joins $2.8 billion raise for Kling AI subsidiary
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