Key facts
- China's embodied AI and robotics sector has attracted significant venture capital, with approximately 370 startups emerging in the last two years.
- Around 50 startups are pursuing public listings in Hong Kong or mainland China.
- In 2025, the sector attracted RMB 73.5 billion in financing, with the first half of 2026 seeing over RMB 46 billion.
- In Q1 2026 alone, Chinese robotics startups raised $3.3 billion, with TARS Robotics securing a $513 million seed round.
- ByteDance has prioritized world models for embodied AI and allocated substantial funds for AI infrastructure.
- Unitree Robotics, a major player, is targeting a $7 billion IPO and reported significant revenue and profit in 2025.
China's capital markets are awash with liquidity, but a shortage of compelling investment opportunities has led to a surge in funding for embodied artificial intelligence and robotics startups. This sector, which combines AI with physical machines, is emerging as a critical new avenue for capital deployment, aiming to reconnect AI with the real economy and revitalize China's industrial ecosystem.
Over the past two years, approximately 370 startups have entered the embodied AI space, with around 50 now pursuing public listings in Hong Kong or mainland China. This trend is driven by the realization that unlike purely digital AI like large language models, embodied AI requires a vast industrial supply chain, including motors, sensors, semiconductors, and manufacturing capabilities. This demand stimulates investment across research, testing facilities, production lines, and a wide array of component suppliers.
In 2025, China's embodied AI and robotics sector attracted RMB 73.5 billion across 744 investment rounds. The momentum continued into the first half of 2026, with disclosed funding exceeding RMB 46 billion across 288 transactions. Notably, in the first quarter of 2026 alone, venture capitalists poured $3.3 billion into Chinese robotics startups across 126 deals, marking a record. This influx of capital is transforming the landscape, with companies like TARS Robotics, a year-old humanoid robotics firm, raising a $513 million seed round at a $1.9 billion valuation before shipping any commercial units.
ByteDance, the parent company of TikTok, has identified world models as its top priority for 2026, signaling a strategic focus on embodied AI. The company has also committed ¥200 billion ($29.4 billion) for AI infrastructure in 2026. Meanwhile, Unitree Robotics, a prominent player, is targeting a $7 billion IPO on the Shanghai STAR Market, having shipped over 5,500 humanoid robots in 2025 and achieved profitability with significant revenue.