Xspark AI raises nearly 100 million yuan to build Physical AI

Chinese startup Xspark AI (无界智航), which builds trusted Physical AI systems, closed its first funding round in July 2026: an angel round of nearly 100 million yuan (about $14 million). Chinese outlet 36Kr reported the deal, citing investor CDH Investments.

Who invested in the round

Three funds co-led the round: CDH Investments' venture arm (鼎晖VGC), Chuxin Capital (初心资本) and SEE Fund (无限基金). Shenzhen Angel Mother Fund (深圳天使母基金) and Shuimu Alumni Seed Fund (水木校友种子基金) joined as co-investors. Both specialize in seed and angel investments in Chinese tech startups.

• Round size — nearly 100 million yuan (~$14 million)
• Lead investors — CDH VGC, Chuxin Capital, SEE Fund
• Co-investors — Shenzhen Angel Mother Fund, Shuimu Alumni Seed Fund
• Use of funds — core technology development, product refinement, scaling Physical AI

According to the company, it will spend the money on developing key technologies, refining its product and commercially scaling its Physical AI solutions.

What is Physical AI

Physical AI sits at the intersection of artificial intelligence and robotics: models control physical devices such as robotic arms, drones and autonomous platforms. Unlike chatbots and generative models, these systems make decisions from real-time sensor data and interact directly with the physical world. The "trusted" label Xspark AI uses in its positioning usually signals a focus on the safety and predictability of autonomous systems — a critical requirement for deploying robots in industrial and commercial settings.

Globally, US companies Physical Intelligence and Figure AI and Chinese players Unitree Robotics and AgiBot work in a similar niche, and competition for capital and talent in embodied AI and humanoid robotics is heating up on both sides of the Pacific. Chinese authorities have named physical AI and robotics among the country's technology development priorities, which is fueling local VC interest in startups like Xspark AI.

What it means

Xspark AI's angel round is one more sign that Chinese venture capital is betting on Physical AI as the next big segment after generative language models — one where competition between startups and global labs is only just beginning.