"China AMD" Mu Xi Shares' Hidden Foreign Capital Shadow

Ask AI · Why Are Foreign Investors Favoring Chinese GPU Startups Like Muxi Co., Ltd.?

Text | JuChao WAVE

Editor | Yang Xuran

Revenue doubles, losses narrow.

Known as “China’s AMD,” Muxi Co., Ltd. delivered a decent report card last year—if you don’t compare it to that dazzling valuation.

During the domestic GPU capital frenzy at the end of last year, it listed later than Moore Thread, but as the “second Chinese GPU stock,” it surged up to 7.6 times on its first day, with a single subscription (500 shares) earning nearly 400k yuan at its peak—setting a record for the most profitable new stock in China’s A-share history and becoming a milestone event in the Chinese stock market.

Its market value was so inflated, and its valuation so high, that it almost sentenced the traditional valuation system of listed companies to death.

The carnival-like market frenzy attracted a large number of investors to follow in. However, its stock price then continued to decline, nearly halving at the lowest point, causing heavy losses for those who chased the high. Early investors, having entered early enough, still made a fortune. Large funds’ strategic placements were only at IPO price, with some of the earliest shares unlocking this June.

Muxi Co., Ltd., as a representative, vividly reflects the current severe inversion of profit-making effects in the primary and secondary markets of the sci-tech innovation sector. This has become the norm in the recent two years of tech stock IPOs.

It is worth noting that among these high-profile tech IPO waves, a phenomenon has emerged where quantitative funds and foreign capital shadows dance together. The “global capital + Chinese sci-tech innovation” narrative, which caters to the style of the STAR Market, combined with the “Chinese retail investors + Chinese public funds” pushing valuations, forms a perfect story—like Hollywood movies on an assembly line—continually projected onto the big screen.

Of course, the story’s ending cannot be all joy. The brutal happiness will ultimately end in brutality.

This article is a deep-value piece from the content team of 《JuChao WAVE》. Follow us on multiple platforms.

01 Inversion

Riding the wave of domestic substitution, the “GPU Four Little Dragons” generally achieved high revenue growth.

By 2025, Muxi Co., Ltd. achieved revenue of 400k yuan, a year-on-year increase of 121.26%, with losses narrowing by 44%, but still bleeding 789 million yuan that year. Another star company, Moore Thread, reached 1.64B yuan in revenue, up 243.37% year-on-year, but still mired in losses, with a total annual loss of 1.51B yuan.

Currently, Chinese GPUs are still in the stage of high R&D and high investment. Last year, Muxi invested 1.02B yuan in R&D, accounting for 62% of its revenue that year. As a result, over the past four years, it accumulated losses of 1.03B yuan, indicating that the company’s market competitiveness and profitability still need improvement.

Unlike domestic CPU and mobile chip companies that start from the mid-to-low end, veteran AMD veteran Chen Weiliang, since founding Muxi, has aimed for world-class standards.

In his view, “from project approval to listing, a GPU takes at least 3 to 5 years, and requires building an extremely complex software ecosystem, so the cycle is very long.” Therefore, building a domestic GPU, with a 1 billion yuan threshold, is just the starting point; advanced process GPUs will cost far more than 1 billion yuan.

Muxi is developing a “comprehensive” capability matrix, with products covering AI computing, training and inference, general computing, and graphics rendering. It has launched the Xisi N series for intelligent inference, the Xiyun C for training, inference, and general computing, and the Xicai G for graphics rendering.

In terms of software, NVIDIA’s CUDA almost dominates the market. Muxi’s strategy is to develop MXMACA natively and compatible with CUDA, iterating in sync with international developments.

On July 24 last year, the Xiyun C600 series was officially released. Its core significance is not only performance and HBM improvements but also a comprehensive domestication of IP architecture, design, manufacturing, and packaging.

Muxi’s co-founder, CTO, and chief hardware architect Peng Li released the Xiyun C600.

Following this “mass production of one generation, R&D of one generation, planning of one generation” strategy, Muxi’s future R&D investment is expected to remain high, and its financial situation will continue to be under pressure.

Since 2022, the company’s net cash flow from operating activities has been continuously negative, with a total outflow of 5.1 billion yuan, inventories nearly doubled to 3.85B yuan, and accounts receivable and prepayments amounting to 726 million yuan and 834 million yuan respectively.

With the “perfect story” of domestic GPUs, these Chinese equivalents of NVIDIA and AMD have received valuations comparable to market dreams. Muxi’s total market value once exceeded 330 billion yuan, and even after a sharp decline, it remains around 250 billion yuan—surpassing state-owned giants like China General Nuclear, COSCO Shipping, and China Shipbuilding.

Reviewing the company’s prospectus and announcements, “financing advisory fees” have attracted attention. Over the past four years, Muxi’s service fees were 36.25 million, 44.5 million, 85.1 million, and 131 million yuan respectively. The company admitted that “financing advisory fees” once accounted for a large proportion. To accelerate financing, it hired multiple financial institutions and paid service fees to third-party agencies proportionally to the financing amount.

While losing money continuously to grow, and paying high fees to financing intermediaries, the fuel that keeps the “capital story” going is ultimately provided by restless retail investors and fund managers who indulge in retail investor wealth.

02 Shadows

On October 30, 1999, Masayoshi Son met Jack Ma at UTStarcom’s building. The two talked for six minutes, and Masayoshi Son handed over a check for 30 million USD. Over the next 15 years, this investment in Alibaba yielded a return of 3,440 times.

Many still question why no Chinese invested in Alibaba at that time, but 26 years later, Chinese GPU companies are beginning to replicate or even surpass the foreign capital miracle of the previous internet era.

Behind Muxi Co., Ltd., Biran Technology, Jiayue Star, Zhigu, Minimax, and other AI large model companies, countless overseas capital shadows appear, especially from US LPs/GPs.

Moreover, they generally participated deeply at the company’s founding, with extremely low costs and highly lucrative profits.

For example, Muxi’s Pre-A round valuation was 1 billion yuan, now earning 250 times profit, and the Pre-IPO round in early 2025 valued the company at 21 billion yuan—more than 13 times in less than a year. This astonishing growth is backed by names like Sequoia, Qiming, IDG, Hillhouse, Dachen, Matrix Partners, and Lightspeed.

Just four months after its founding, Sequoia invested 110 million yuan (angel round). A month later, Matrix Partners and Lightspeed heavily invested, pushing the post-investment valuation to around 2 billion yuan. These three have continued to increase their stakes.

On January 22, 2021, Muxi held its first board meeting. (Source: Monolith, Tianzhong.com)

In the current shareholder structure, besides controlling persons Chen Weiliang and Ge Weidong, the two earliest investors in the Pre-A round hold the most shares: Matrix Partners China holds 5.13%, and Sequoia China holds 4.19%; their combined market value is as high as 23.3 billion yuan.

The same story also happened with Biran Technology. In 2019, founder Zhang Wen and Columbia University alumnus Zhou Zhifeng had breakfast in Beijing, where Zhou revealed his idea to start GPU business. Zhou is a managing partner at Qiming Venture Partners, which became one of Biran’s earliest investors.

Moreover, Biran Technology completed a 1.1 billion yuan Series A financing within just nine months of founding, setting a record for domestic industry A-round funding at the time; in March 2021, it completed a Series B with over 4.7 billion yuan, again breaking funding records. This demonstrates a strong “money-raising” ability.

Biran’s star-studded investors include not only industry leaders like Qiming and Hillhouse, rarely seen together in hard tech but also US-investment bank-backed Yunhui Capital, which is one of Biran’s top five shareholders.

Yunhui Capital, founded by Xiong Yanjin, Zhu Feng, and four other former Goldman Sachs employees, began investing in Biran from Pre-A++ round through four rounds, continuously holding large positions and successfully pushing Biran to the capital market.

Hong Kong stocks’ “AI large model twin stars” are no exception.

Minimax has gathered top investors like Hillhouse, IDG, Sequoia, and Matrix Partners. Hillhouse and IDG were the earliest angel investors, with a post-investment valuation of only 200 million USD (1.38 billion yuan). Today, the paper returns from the angel round have exceeded 200 times.

Zhigu raised over 8.3 billion yuan before listing, including top VC/PE firms like Dachen, Qiming, Today Capital, Lightspeed, Sequoia, Hillhouse, and Yunhui.

Unlisted Jiayue Star, after being led by Yin Qizhi, received over 5 billion yuan in early 2024, breaking the single-funding record for domestic large model companies in the past year. It is now planning to go public in Hong Kong with a target valuation of 1.5B USD.

The angel investors of Jiayue Star also include Sequoia, Qiming, and IDG. With an expected valuation of 10 billion USD, investors who entered in 2024 have already earned nearly 10 times, and the earliest angel investors are even more profitable.

Yue Zhilin’s Moon of Darkness (Kimi), during its angel round, attracted Sequoia, ZhenFund, and Today Capital, then received investments from GGV Capital and cross-border PE firm KKR. This star enterprise, from founding to a unicorn valued at over 10 billion USD, took just over two years—faster than Pinduoduo and ByteDance.

These capital investments not only helped AI companies initiate their establishment but also assisted in formulating corporate strategies, business models, and market strategies, further fueling their valuation surges. Most of these investors are not truly “Chinese capital,” yet they profit the most