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Giant models grab headlines, but some Chinese start-ups bet on smaller phone-ready AI

Chinese AI startups are shifting focus to lightweight models that run on smartphones and laptops, challenging the dominance of giant cloud-based systems. Beijing-based ModelBest raised over 5 billion yuan ($738 million) this year, reaching a 20 billion yuan valuation, as investors bet on on-device AI for faster processing, privacy, and lower costs.

read1 min views1 publishedJul 16, 2026
Giant models grab headlines, but some Chinese start-ups bet on smaller phone-ready AI
Image: Scmp (auto-discovered)

A growing number of tech firms are pivoting to lightweight models designed to run entirely on smartphones and laptops

global artificial intelligence racepushes the limits of scale with massive, trillion-parameter models, a parallel contest is heating up over smaller systems.

lightweight modelsdesigned to run entirely on smartphones or laptops.

Proponents said this localised approach would be a game-changer, promising faster processing, enhanced data privacy and lower operating costs.

Investors are buying in. Beijing-based ModelBest, a prominent player in on-device AI, raised more than 5 billion yuan (US$738 million) this year, according to a WeChat post by investor Shanghai Mejoy Capital.

ModelBest’s latest C+ Series funding round, completed earlier this week, propelled the firm’s valuation to 20 billion yuan, according to the post.

The start-up did not disclose the size of its latest funding round and did not immediately respond to a request for comment on Thursday.

The funding milestone comes amid a flurry of activity in China’s so-called local AI or edge AI sector.

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