🤖Alibaba's Free AI Lottery Ticket's
Alibaba is a high quality company on its own but when you dig under the surface and see you also get several AI lottery tickets along with it. Things get more interesting.
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Alibaba isn’t just a top e-commerce and cloud player—its overlooked AI investments offer a hidden bonus. Like buying a great stock with a free lottery ticket!
In this article, we'll dive into some of Alibaba's biggest AI investments. Exploring what these companies do and how they could shape the future.
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Alibaba’s AI Investments
Alibaba has made notable investments in several promising AI startups, each focusing on innovative technologies and applications.
Moonshot AI
Moonshot AI is a cutting-edge tech company specializing in grid computing and developing multimodal large models. Multimodal models are advanced AI systems that process multiple types of data, such as text and images, simultaneously. The company focuses on creating AI-powered solutions for e-commerce. Including automated website optimization that enhances online retailers' sales by improving website design and functionality.
In early 2024, Alibaba led a significant $1 billion funding round for Moonshot AI. Nearly half of this investment came in the form of cloud computing credits. Giving the company extensive resources for AI development. This funding elevated Moonshot AI’s valuation to an impressive $2.5 billion.
In summary, Moonshot AI is becoming a key player in e-commerce-focused AI. Bolstered by substantial support from Alibaba.
Zhipu AI
Zhipu AI is dedicated to teaching machines to think more like humans. The company focuses on two main technologies:
Large Language Models (LLMs): These AI systems are designed to understand and generate human-like text. Notable models include:
ChatGLM and GLM-130B, which facilitate natural conversations.
CodeGeeX, specialized in programming code.
CogVLM and CogView, multimodal models that handle both text and images.
Billion-Scale Knowledge Graphs: Massive databases that organize and connect information like the human brain. Enhancing AI reasoning and understanding.
Zhipu AI aims to build a powerful cognitive engine and advance toward Artificial General Intelligence (AGI). AI capable of performing any intellectual task a human can.
In short, Zhipu AI is at the forefront of developing AI that mimics human thinking. With innovations that could significantly impact the future of artificial intelligence.
Minimax AI
Minimax AI is breaking new ground with its latest innovation. The Video-01 text-to-video model. This technology generates highly realistic videos from text descriptions. Capturing intricate details such as human hand motions. The company unveiled this groundbreaking tool at its inaugural developer conference in Shanghai.
Minimax AI is a leader in generative AI. Focusing on creating new content like videos, images, and text. The release of Video-01 highlights Minimax’s technological prowess and positions it as a key player in AI-driven media and entertainment.
Minimax’s expertise in human modeling and text-to-video generation sets it apart in China’s AI landscape, offering innovative solutions for content creation and engagement.
01.AI
01.AI is an emerging Chinese AI startup with a mission to make AI more accessible. While enhancing the synergy between humans and AI. Key models include:
Yi-34B: An open-source AI model available in Chinese and English, designed for developers needing a powerful yet affordable option. It excels in reading comprehension, common-sense reasoning, math, and coding, and ranks highly on the Hugging Face Leaderboard.
Multimodal Model: Handles both images and text, enabling it to identify and interpret visual and textual data.
Qwen-72B: An AI model that has topped the Hugging Face leaderboard, becoming the second Chinese model to achieve this. It has shown superior performance to OpenAI’s GPT-4 in certain Chinese language tasks.
Founded by Kai-Fu Lee, a renowned AI pioneer, 01.AI quickly gained traction. In July 2024, it secured $689.6 million in funding from major Chinese tech firms. Including Alibaba, Tencent, and Xiaomi, raising its valuation to over $2.7 billion. 01.AI is making significant strides in both local and global AI markets.
Baichuan AI
Baichuan AI is a fast-growing Chinese AI startup focused on developing language models for various applications. Key models include:
Baichuan 4 LLM: A self-developed large language model that ranks highly on SuperCLUE, a benchmark for Chinese LLMs. It excels in understanding and responding to user queries.
Baichuan-13B: An open-source language model trained on 1.4 trillion tokens—40% more than Meta’s LLaMA—capable of handling tasks in both English and Chinese.
Baichuan-7B: A family of LLMs that performs well on both Chinese and English benchmarks. It is quantized for deployment, making it suitable for on-device use.
AI Assistant: A chatbot designed to make AI technology more accessible to local users in China.
Founded in April 2023 by Wang Xiaochuan, former CEO of Sogou, Baichuan AI quickly attracted attention. In July 2024, it raised $689.6 million from major Chinese tech firms. Including Alibaba, Tencent, and Xiaomi, boosting its valuation to over $2.7 billion. Baichuan AI is emerging as a key player in advanced AI development for both local and global markets.
Overall, Alibaba's investment strategy supports these startups while aligning with its broader cloud computing business.
Poised for the AI Surge
Alibaba Group stands out as a particularly enticing investment, not just for its dominance in e-commerce and cloud computing, but for its smart positioning in the rapidly expanding AI sector.
China’s AI market is expected to leap from USD 29 billion in 2023 to USD 150 billion by 2032, with a CAGR of nearly 20%1. Recent forecasts are even more optimistic. Predicting the market will hit USD 154.8 billion by 2030, with a 28.61% growth rate from 2024 to 20302.
This rapid growth is already underway, as the core AI industry in China saw a 13.9% increase in 2023. With a total market size of 578.4 billion yuan (around $79.67 billion)3.
The impact of AI on China’s economy will be transformative. It’s estimated that AI investments could add a jaw-dropping $7 trillion to China’s GDP by 2030. Driven by a 12% CAGR in AI-related economic benefits4.
Sectors like automotive, transportation, and logistics are expected to drive a substantial portion of this growth. Contributing around 64% of a projected $600 billion in AI value creation5.
Alibaba’s bets on AI startups like Moonshot AI, Zhipu AI, Minimax AI, 01.AI, and Baichaun AI position it to reap significant rewards. Backed by financial support and cloud infrastructure, these startups are set to accelerate growth and innovation. Enhancing Alibaba’s overall market presence.
In short, Alibaba’s stock is an investment opportunity too good to ignore. With its e-commerce and cloud computing prowess. Combined with forward-thinking AI investments Alibaba is primed to harness explosive AI growth. Making its current valuation an enticing bargain.
Disclaimer: This content is for informational and entertainment purposes only. The opinions expressed are my own and not professional financial advice. I do not know your personal financial situation. Please do your own research and consult with a licensed financial advisor before making any investment decisions. Investing involves risk, including the potential loss of principal.
Check out some of my other articles!
https://www.credenceresearch.com/report/china-artificial-intelligence-market
https://www.statista.com/outlook/tmo/artificial-intelligence/china
https://www.chinadaily.com.cn/a/202406/20/WS6673ee9ba31095c51c509f89.html
https://www.artisanpartners.com/content/dam/documents/insights/vxus/Chinas-AI-Growth-Multiplier-vSAI.pdf
https://www.mckinsey.com/capabilities/quantumblack/our-insights/the-next-frontier-for-ai-in-china-could-add-600-billion-to-its-economy
Nice call, hopefully you established a nice position.
Why do you think commentators have said BABA’s current valuation is an enticing bargain for the last 5 years, and yet, have been wrong?