CNBC's The China Connection newsletter: Foreign investors warm to China’s cheaper AI valuations despite fears of a U.S. bubble

This report is from this week's CNBC's The China Connection newsletter, which brings you insights and analysis on what's driving the world's second-largest economy. You can subscribehere.

The big story

Sitting in his new Beijing office, AI2 Robotics Founder and CEO Eric Guo wistfully reflected on fundraising challenges in China — and noted that U.S.-based humanoid rival Figure recently raised $1 billion in a single round, at a $39 billion valuation. The Shenzhen-based startup hit a $1 billion valuation this fall, reaching unicorn status just over two years after launch — thanks to a whopping nine fundraising rounds so far this year, according to a person familiar with the matter.

Jiang Zheyuan, chairman of Noetix Robotics, with a robotic android at the company's offices in Beijing, China, on Friday, June 27, 2025.

Na Bian | Bloomberg | Getty Images

A fraction of the money This month alone, at least three China-based funds with an AI focus have raised capital denominated in U.S. dollars from overseas investors: