China wants to dominate the AI market by 2030, and with its leading  company in the space recently upping investment by $620 million, it  seems likely.

SenseTime Group Ltd. has raised $620 million at a valuation of more  than $4.5 billion just months after scoring a similar amount from  investors led by Alibaba Group Holding Ltd. and Singapore’s state  investment firm.

Fidelity International and Silver Lake Partners were among the  investors in the latest financing, bringing the total amount raised by  the three-year-old image recognition startup in the past six months to  more than $1.2 billion and tripling its valuation in under a year. Tiger  Capital, Qualcomm Ventures and Hopu Capital also participated. The  latest funding will go toward research and talent acquisition, SenseTime  said in a statement Thursday.

Investors are handing billions of dollars to Chinese artificial  intelligence startups, hoping to ride a wave of support from a  government intent on becoming the world leader in the technology by  2030. But the growing hype is encouraging everything from video services  to language schools to claim AI as integral to their business to win  funding.  Some investors warn the sector could experience a downturn  towards the end of this year if those companies fail to deliver revenue  growth.

SenseTime specializes in systems that analyze faces and images on an  enormous scale and works with policing bodies across China. The startup  said it experienced 400% growth in each of the past three years as it  encompassed more industries. Business contract revenue is up more than  10-fold so far this year, according to its statement.

The company’s a big contributor to the world’s biggest system of  surveillance: if you’ve ever been photographed with a Chinese-made phone  or walked the streets of a Chinese city, chances are your face has been  digitally crunched by SenseTime software built into more than 100  million mobile devices. The country is ramping up spending on  surveillance as it cracks down hard on restive parts of the country,  including Xinjiang.

A key focus for SenseTime is its internal talent development program,  that seeks to cut its reliance on externally-trained AI developers as  the industry hits a global crunch. It’s an effort that will become  increasingly important as the U.S. — currently the source of many of  the world leading computer science graduates — drafts limitations on  how long Chinese students can stay in the country.

Aside from Alibaba, it also counts Temasek Holdings Pte and retailer  Suning.com Co. as investors. It’s the largest, according to CB Insights,  of a plethora of private AI outfits.

Fellow facial-recognition startup Megvii Inc. raised $460 million  last year, while smaller niche players from Yitu to Malong Technologies  have also won funding. A key partner, Hangzhou Hikvision Digital  Technology, is one of the world’s biggest suppliers of security cameras  and developing its own competing AI technology.

Original Article published by Bloomberg News/ 2018