China's Regional AI Race: Beijing and Shanghai Lead as Second-Tier Cities Gain Ground

After graduating from Tsinghua and earning his PhD at Carnegie Mellon University, Yang returned to China and later launched Moonshot in Beijing in 2023. Meanwhile, Liang attended Zhejiang University in eastern China, spent time in Chengdu in the southwestern province of Sichuan and ultimately settled in Hangzhou in Zhejiang to launch both his quantitative hedge fund and DeepSeek.

Industry metrics underscore Guangdong’s uphill battle. According to the Hurun Research Institute, Beijing leads the country with 19 of China’s top 50 AI companies, followed by Shanghai with 14. Guangzhou and Shenzhen, the two biggest cities in Guangdong, hold 10 combined.

Meanwhile, second-tier cities are rapidly gaining ground. Hangzhou is thriving with star firms like DeepSeek and Unitree Robotics, while Hefei and Wuhan are building momentum around semiconductor giants ChangXin Memory Technologies and Yangtze Memory Technologies Corp.

A core factor behind this disparity is the concentration of academic talent, according to experts.