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Ben Jiang

Chinese short video giant Kuaishou said on Thursday evening that its artificial intelligence video arm, Kling AI, was seeking to raise around US$3 billion in its first external fundraising round, according to a filing to Hong Kong Exchanges and Clearing.
The funding round, first reported by the South China Morning Post on Wednesday, was backed by a long list of investors, spanning Chinese technology heavyweights, state-backed investment vehicles and entertainment industry participants.
Baidu, Alibaba’s cloud unit, and Tencent were involved in the funding round, according to the filing. State-backed capital also participated, including the Beijing Information Industry Development Investment Fund and the Beijing Artificial Intelligence Industry Investment Fund.
Alibaba is the owner of SCMP.
Backers also include firms such as Huace Film & TV and Mango Investment in the media and entertainment industry, where the use of AI video tools is increasing.
The financing round, the largest in the world by an AI video model firm, comes at a time when competition in the global AI video sector is heating up.
ByteDance, a Chinese rival, sent shock waves through Hollywood in February with the release of its Seedance 2.0 model, whose ability to generate lifelike and true-to-detail videos led entertainment executives to express concerns about the technology’s potential to disrupt film and television production and displace creative jobs.

Kuaishou’s Kling launched its latest 3.0 AI model series in the same month, saying it gave creators “greater narrative control and stronger consistency in AI video generation”.
Kling monetises through individual subscriptions and enterprise application programming interface (API) access, with overseas markets driving about three-fourths of revenue, according to Kuaishou. Boosted by its 3.0 model, Kling’s annualised revenue estimate surged to US$500 million in March from US$300 million in January.
Analysts said spinning off Kling for external funding eased the financial strain on Kuaishou, given the “cash-burning” nature of AI development.
“The AI video generation sector is known as a ‘black hole’ of computing demand with high-rising capital expenditure,” said Wu Xiaxue, analyst at Hangzhou-based internet market consultancy 100ec.cn.
Analysts at investment consultancy CCB International (CCBI) expected the spin off would unlock hidden value, according to a note it sent to clients on Friday.
Specifically, “this carve-out would transform Kling from an AI cost centre subsidised by the parent into a self-sustaining entity,” the analysts wrote in the note.
Wu cautioned that AI video tools were far from profitable. “The company’s future hinges on its ability to turn its funding, technological edge, and market advantages into sustainable profits,” she said.
The financing round values Kling at US$18 billion – nearly 80 per cent of Kuaishou’s HK$182 billion (US$23.2 billion) market capitalisation as of Friday. The announcement was met with a tepid response from investors, with Kuaishou shares closing down 0.09 per cent at HK$42.60 on Friday.


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Short video giant’s filing confirms SCMP exclusive; investors include tech heavyweights, state investment vehicles and entertainment firms


Short video giant’s filing confirms SCMP exclusive; investors include tech heavyweights, state investment vehicles and entertainment firms.


Kuaishou files US$3 billion Kling AI funding round to Hong Kong stock exchange

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Short video giant’s filing confirms SCMP exclusive; investors include tech heavyweights, state investment vehicles and entertainment firms

Short video giant’s filing confirms SCMP exclusive; investors include tech heavyweights, state investment vehicles and entertainment firms