From Cambridge to Suzhou: a Chinese AI start-up’s journey to unicorn status

In 2007, a Chinese PhD student at the University of Cambridge launched a start-up with a former classmate focused on using speech recognition technology to help foreigners learn Chinese.

A year later, Yu Kai and his team returned to China, aiming to draw on the country’s vast market and deep talent pool to propel their nascent company’s development.

Swapping Cambridge for Suzhou – a city in eastern China then more famous for its picturesque gardens and canals than its tech sector – may have seemed like an unconventional choice at the time, but it proved to be an inspired move.

Yu’s company, AI Speech, is now riding China’s artificial intelligence boom as a leader in conversational AI. It has raised hundreds of millions of dollars over several funding rounds, with the Hurun Research Institute recognising the firm as an AI unicorn.

Its technology powers voice activation software used by carmakers Mercedes-Benz and BYD, as well as smart home brands Midea and Haier. It also develops AI chips and smart office devices like microphones and speakers.

Though the company’s funding mostly comes from private investors and its own revenue, China’s industrial policies have also played an important role in supporting AI Speech, according to Yu.