The archive · AI & Models · Financial decision · 2023–2026
StepFun Reaches US$12B Valuation in 3 Years
Founded April 2023, StepFun raised successive rounds, reaching ~US$12B valuation by May 2026, and prepared for HK IPO.
StepFun (阶跃星辰)
What the business is
Builds general-purpose multimodal foundation large models (Step-1 through Step-3.5 series) and supplies model capabilities to device makers such as smartphone and automotive manufacturers.
Starting capital：November 2023 Series A of tens of millions of US dollars; investors were 5Y Capital (五源资本), Qiming Venture Partners (启明创投), and Sequoia China (红杉中国).
How it started
In April 2023, Jiang Daxin, former Microsoft Global Vice President and Chief Scientist of the Microsoft Asia Internet Engineering Academy (微软亚洲互联网工程院), founded StepFun in Shanghai. At that time, ChatGPT had just ignited the Chinese large-model startup wave, and the company entered with a Microsoft-affiliated team; in November of the same year, it completed a Series A of tens of millions of US dollars (5Y Capital, Qiming Venture Partners, Sequoia China) and began training the hundred-billion-parameter model Step-1.
What happened
In December 2024, the Series B rose to hundreds of millions of US dollars, and Shanghai Guotou entered; in January 2026, the B+ round secured RMB 5 billion, and Tencent (腾讯) invested additional amounts in three consecutive rounds; in February 2026, it recruited Megvii (旷视科技) founder Yin Qi as President, and Step 3.5 Flash entered the top three of the OpenClaw agent platform usage rankings; the model was deployed through OPPO smartphones and Geely Auto (吉利汽车) systems.
How it ended up
In May 2026, it completed a US$2.5 billion Pre-IPO round, with joint investment from ZTE (中兴通讯), Huaqin Technology (华勤技术), Tencent Investment, OmniVision Group (豪威集团), and Longcheer Technology (龙旗科技); the market estimated its valuation at about US$12 billion. The company subsequently dismantled its Cayman red-chip structure and prepared for a Hong Kong IPO, entering the IPO countdown.
Background
StepFun's bet is: China can still accommodate another foundation large-model company sprinting toward general artificial intelligence, and the winning method is 'speed'—rapid fundraising, rapid training, and rapid entry into devices. In April 2023, former Microsoft Global Vice President Jiang Daxin founded the company in Shanghai; five months later it completed Series A, in December 2024 its Series B rose to hundreds of millions of US dollars, in January 2026 its B+ round raised RMB 5 billion, and in May it obtained a US$2.5 billion Pre-IPO round.
On the product line, the company started with the Step-1 hundred-billion-parameter model and iterated all the way to Step-3.5; in early 2026, Step 3.5 Flash entered the top three of the OpenClaw agent platform usage rankings, and the model was also deployed through OPPO smartphones and Geely Auto's intelligent systems. In February 2026, the company brought in Megvii founder Yin Qi as President, strengthening management, which was seen as a signal of shifting from a 'fundraising sprint' to an 'IPO sprint'.
Result: the market estimated its valuation at about US$12 billion; the company dismantled its Cayman red-chip structure to pave the way for a Hong Kong IPO, becoming another Chinese domestic large-model company after Zhipu (智谱) and MiniMax to sprint toward listing. This money bets that 'scaling laws have not yet failed,' and capital voted in favor with three consecutive rounds of additional investment.
What has to be true
- Post-ChatGPT funding window opened; StepFun raised consecutively, capital concentrated, fundraising became barrier.
- Jiang Daxin, ex-Microsoft chief scientist, gave early investors confidence.
- Device integration (smartphones, cars) created revenue scenarios earlier than pure APIs.
- Zhipu and MiniMax HK listings opened exit; Pre-IPO taken by ZTE and Huaqin, signaling listing certainty.
What can be applied
In large models, fundraising pace is a product: rapid raises expanded compute narrative, growing valuation from millions to US$12B, showing capital first beats profitability.
Aftermath
By July 2026, StepFun expanded: after US$2.5B Pre-IPO, valuation ~US$12B; dismantled red-chip for HK IPO, Reuters reported ~US$10B anchor talks. Step 3.5 Flash ranked top 3 on OpenClaw, partnered with OPPO and Geely; Yin Qi became President. Risk: cash burn may outpace funding before listing.
Sources
- 从阶跃星辰到银河通用：WAIC 参展企业背后的资本迁徙路线
- Chinese AI startup StepFun to unwind offshore structure to pave way for IPO
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