Google Tiptoes Back Into China With Funding of Startup In Mobile Voice Search

Google has taken a minority stake in Beijing-based AI firm Mobvoi Inc. in a $75 million fund raising for the startup. Google’s investment is pegged at $40 million to $45 million with a stake of 10 to 20 percent. Past investors in Mobvoi include Sequoia Capital China, ZhenFund and SIG.

Mobvoi, founded by Li Zhifei, a former research scientist at Google, provides mobile voice search in Chinese, through an app that claims 2 million users. The company has also developed a smartwatch called Ticwear, which has reported sales of 30,000 since its July launch, as well as a Chinese smartwatch operating system. Earlier this year, Mobvoi struck a partnership with Google to provide Chinese-language voice search for Google’s Android Wear smartwatch OS.

The investment in Mobvoi is a rare deal for Google in China, a market of nearly 700 million Internet users. It is one of just a few investments for the search giant since 2010, when Google moved its servers to Hong Kong and ceased many of its mainland operations. It comes at a time when Google has taken other steps to rebuild its presence in China, in verticals outside of search. In September, the search giant was in talks with the Chinese government and handset makers about launching a new Android app store in the country. Last year, Google’s VC arm invested in China’s InnoLight Technology Corp., a leading high-speed optical transceivers supplier.

This week’s investment shows how quickly Chinese entrepreneurs are developing new technologies for the domestic market, and highlights Google’s ongoing interest in AI technologies including speech recognition and natural language processing. Most of all, it gives onlookers plenty to wonder about: is this a foreshadowing of Google in China, Part II?