Executive Summary

U.S. artificial intelligence startups are raising billions of dollars from private investors both domestic and abroad. Chinese investors in U.S. startups have attracted particular scrutiny due to concerns related to technology transfer, and yet there is little systematic analysis of foreign investment in U.S. AI startups, or the location of investors into U.S. AI startups more broadly. By analyzing thousands of U.S.-based startups and their investors, we find:

• China is the top location for foreign investors into top U.S. AI startups, with 5 percent of total investors. Foreign investors as a whole make up 24 percent of the investors into top U.S. AI startups.
• Chinese investors are more likely to invest in U.S. AI startups than in other industries. Top U.S. AI startups are likely to have a greater number of Chinese investors than startups in other industries.
• 20 percent of top U.S. AI startups have at least one Chinese investor, despite the fact that Chinese investors only make up 5 percent of investors into top U.S. AI startups.
• About $3B (15 percent) of the $21B raised by top U.S. AI startups was raised in rounds involving at least one Chinese investor.
• Domestically, the San Francisco Bay Area is central to the AI startup scene—49 percent of U.S. investors in top U.S. AI startups are located there, and 95 percent of top U.S. AI startups have at least one investor from the Bay Area.