Chinese artificial intelligence chipmaker Enflame Technology Co. Ltd. has reportedly closed on a bumper 2 billion yuan ($237.7 million) late-stage funding round.

Today’s Series D round, first reported by Reuters, is said to be led by a subsidiary of Shanghai International Group Co. Ltd., and saw participation from Tencent Holdings Ltd., the creator of the WeChat app and Meitu-a, a photo editing app. Other Chinese investors, including SummitView Capital, YTI Capital, Hundreds Capital, Redpoint China Ventures and GF Qianhe Investment are also believed to have participated.

Founded in 2018, Enflame is said to focus on manufacturing computer chips for AI. Its cloud chips are used in AI applications across diverse industries, including education, smart cities and scientific research. The funding round comes at a time when investors are showing great interest in AI infrastructure due to the success of OpenAI LP’s ChatGPT, which has helped to highlight the key role of the specialized hardware that goes into AI models.

Enflame founder and Chief Executive Zhao Lidong told Chinese media the funds from today’s round will enable the company to create more competitive AI chips by collaborating with industry leaders. He also expressed a desire for his company to play an active role in helping to shape future AI chip standards.

Lidong has a lot of pedigree in the computer chipmaking industry, having previously held senior leadership positions at China’s state-owned semiconductor conglomerate Tsinghua Unigroup Ltd. Enflame’s other co-founder, Zhang Yalin, previously headed up Advanced Micro Devices Inc.’s Shanghai-based research center.

The backing of Tencent in the latest round is notable, as Enflame previously collaborated with it to create an AI chip called “Zixiao” for processing images, video and natural language. Yao Leiwen, managing director of Tencent’s Investment Department, said the collaboration will allow it to continue to deliver high-quality AI solutions in the financial services and transportation sectors.

The round’s lead investor, Shanghai International Group, has previously backed other AI startups and is said to have a keen strategic interest in fostering AI development within Shanghai’s greater municipality area.

Prior to today’s round Enflame reportedly raised 1.8 billion yuan in a January 2021 funding round led by Primavera Capital Group, CITIC Private Equity and CICC Capital. In June 2022 it followed with an extended Series C round led by the China Integrated Circuit Industry Investment Fund II.

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