House committee takes aim at U.S. venture capital firms for investments in Chinese A.I.
The House Select Committee on the Chinese Communist Party sent letters to four separate U.S. venture capital firms, including Qualcomm’s venture arm, expressing “serious concern” about their investments in Chinese tech startups.
The letters, which were made public on Wednesday, were sent to GGV Capital, GST Ventures, Qualcomm Ventures, and Walden International. They were written by and Wisconsin Republican Mike Gallagher and Illinois Democrat Raja Krishnamoorthi, the top two members on the committee.
related investing news
Of particular concern to the lawmakers are investments in artificial intelligence, chipmakers and quantum computing companies in China. They also noted that some of the companies to receive U.S. money have been linked to the profiling and tracking of Uyghur ethnic minorities in China.
“Like AI, the domestic development of semiconductors is a top priority of the Chinese Communist Party,” the letter says. “Semiconductors are essential for artificial intelligence, quantum computing, and other advanced dual use technology.”
Representatives from the four venture firms who received the letters did not immediately respond to requests for comment.
The outreach represents the latest bipartisan effort by politicians to step up pressure on U.S. investments in China as tension swells between the world’s two largest economies and national security concerns escalate. U.S. Treasury Secretary Janet Yellen traveled to China earlier this month as part of a plan to stabilize relations with China. Secretary of State Antony Blinken visited in June.
In their letter, Gallagher and Krishnamoorthi linked dozens of particular investments to human rights violations and efforts to enhance China’s military, which runs counter to American interests.
Qualcomm Ventures, for example, made 13 investments in Chinese A.I. companies from 2015 to 2021, according to the letter. One investment, in the now publicly-traded SenseTime, was linked by a New York Times report to Chinese tracking and profiling of the Uyghurs.
In addition to Qualcomm, PitchBook data shows that U.S. firms Tiger Global Management and Silver Lake, which were not mentioned in the letter, invested in SenseTime prior to its 2021 IPO.
Tiger Global did not immediately return a request for comment.
Qualcomm’s investment in Denglin Technology, an apparent competitor, also faces Congressional scrutiny. Qualcomm was one of Denglin’s earliest backers, according to PitchBook, and invested in an additional 2022 funding round.
The firm with the most potentially problematic investments, according to the letter is GGV Capital, which has offices in Silicon Valley, San Francisco, Shanghai, Beijing and Singapore. The letter identified 43 different investments in Chinese AI companies from 2015 to 2021, more than any other identified by independent researchers at Georgetown’s Center for Security and Emerging Technology.
GGV has $9.2 billion in assets under management, and established operations on the ground in China in 2005. Even before that, it invested in Chinese e-commerce giant Alibaba, and subsequently backed TikTok parent ByteDance and ride-hailing company Didi.
Gallagher and Krishnamoorthi identify GGV’s investment in Megvii, a Beijing-based facial recognition software provider, as a point of concern. The company “actively supports the surveillance of Uyghurs,” the letter says.
Megvii is backed by a number of major investors, including Alibaba, Foxconn and the Macquarie Group. GGV invested in Megvii in 2019 alongside Abu Dhabi’s sovereign wealth fund in a deal that valued the company at about $4 billion.
Walden, a smaller firm, was identified as a particularly significant backer of Chinese AI companies. The letter said that from 2015 to 2021, at least 39% of the firm’s AI deals were in that sector, including one investment in a now blacklisted company called Intellifusion.
Intellifusion has since gone public and has a market cap of 22 billion Chinese yuan, or roughly $3 billion.
Regarding GSR Ventures, the letter said the firm “was among the top U.S.-located investors in PRC artificial intelligence companies between 2015 and 2021, according to a recent report by the Center for Security and Emerging Technology.” The lawmakers cited 33 distinct investments in the six-year period, including Horizon Robotics, which was last privately valued at $5 billion in 2021.
The letters advance Gallagher’s push for controls on U.S. money in key technologies in China.
After meeting with Silicon Valley executives in April, Gallagher told CNBC in an interview that he “emerged from that day cautiously optimistic that we could put in place some sensible controls on American capital flowing to China that would allow us to not fund our own destruction or fund our own loss in the great AI race.”
He said at the time he found there was “broad support” among venture capitalists and others to keep U.S. asset managers from investing in Chinese AI firms.
The U.S. Commerce Department has also considered steps to ensure U.S. technologies can’t be overly leveraged by China to advance its own AI efforts. The Wall Street Journal reported last month that the agency was weighing further limits on advanced chips used for AI that could be exported to China.
Pressure has been building on VC firms with substantial investments in China, in part due to concerns over intellectual property theft within technology and a budding AI race. Last month, legendary VC firm Sequoia Capital said it would split its international business into three parts, with Neil Shen helming its powerful Sequoia China unit.
WATCH: A.I. will be vital for U.S. to keep its lead over China
Open AI CEO Sam Altman speaks at the annual Snowflake Summit in San Francisco, California on June 02, 2025.
Justin Sullivan | Getty Images News | Getty Images
OpenAI is rapidly expanding its presence in India — one of the key markets for its flagship ChatGPT product.
India is an appealing destination for U.S. tech giants, with companies ranging from Google to Meta betting on its huge — and young — population over recent years.
OpenAI CEO Sam Altman visited the country in February this year and met with the country’s IT Minister Ashwini Vaishnaw to discuss collaboration. During the visit, Altman said India was OpenAI’s second-largest market by number of users.
He has subsequently said that AI adoption in India is “amazing to watch.”
“We love to see the explosion of creativity–india is outpacing the world,” he said on X earlier this year.
India is one of ChatGPT’s fastest-growing markets globally, Nick Patience, practice lead for AI at tech research and analysis firm Futurum Group, told CNBC. “OpenAI’s India focus is a strategic move to gain a competitive edge,” he added.
Here’s a rundown of how OpenAI is expanding in India.
ChatGPT explosion
ChatGPT, OpenAI’s core product, has seen strong growth in India. The app was downloaded 10.2 million times in India in August, a huge jump from the 2.5 million downloads seen during the same month last year, according to analytics firm Appfigures.
Since its launch, ChatGPT has 111 million downloads in India, ahead of its 80 million downloads in the U.S, Appfigures data shows.
Downloads do not necessarily equal daily or monthly users, but the figures emphasise OpenAI’s growth trajectory in the country.
The download numbers are also far ahead of rivals, including Google’s Gemini and Anthropic’s Claude. The closest challenger was Perplexity, Appfigures said, which had 6.4 million downloads in August.
India-specific product
User spending on ChatGPT has been increasing. To date, Indian users have spent $21.3 million on ChatGPT, Appfigures data shows. In comparison, U.S. users have spent $784 million.
That underlines the fact that while the number of users in India is huge, it remains a price-sensitive market.
To address this, OpenAI in August launched ChatGPT Go, a low-cost 399-rupees-($4.53)-a-month plan for its AI app.
“It’s a classic wedge strategy to capture a price-sensitive market and build a user base that will be difficult for local players to dislodge later,” Futurum Group’s Patience said of the strategy.
Infrastructure and hiring
According to Bloomberg, OpenAI is scouting a location in India for a data center with at least 1-gigawatt capacity. The facility will be part of OpenAI’s Stargate-branded infrastructure push, Bloomberg said this week, although CNBC was unable to verify the report.
The ChatGPT developer said last month that it would open a local office in the market and is currently advertising three sales roles in India.
It also announced last month an education program in India that will include funding for research and provide half a million ChatGPT licenses for educators and students across the country.
India challenges
While India doesn’t have a home-grown artificial intelligence company as big as OpenAI, there are some challengers in the form of domestic startups, including Sarvam AI and Krutrim, and other American tech giants like Google and Meta.
Continued geopolitical tensions between the U.S. and India over trade, however, have the potential to cause complications if there’s any backlash from New Delhi against American tech firms.
OpenAI is also locked in a legal battle with Asian News International in India, which has accused the ChatGPT developer of using copyrighted material illegally. It’s a closely-watched case in the country for how copyright laws apply in the AI era.
“OpenAI’s success in India is not guaranteed and depends heavily on its ability to navigate these legal and political hurdles,” Futurum Group’s Patience said.
“While the Indian market is vast, its diversity in languages and user needs presents challenges. OpenAI’s ability to deliver a truly localized product and its long-term impact on India’s AI talent remain uncertain.”
Bret Taylor, chairman of the board of directors of OpenAI, attends the annual Allen and Co. Sun Valley Media and Technology Conference at the Sun Valley Resort in Sun Valley, Idaho, on July 8, 2025.
David A. Grogan | CNBC
Bret Taylor’s artificial intelligence startup Sierra has just joined an exclusive club: The company sports a new $10 billion valuation after raising $350 million in fresh capital.
Sierra is one of just a handful of AI startups, including OpenAI, Anthropic, xAI, Safe Superintelligence and Thinking Machines that are valued at or above $10 billion.
Investors are pouring money into this competitive group of companies in the hopes that they’ll eventually hit the public markets.
Taylor is the chairman of OpenAI’s board, and previously served as co-CEO of Salesforce alongside Marc Benioff. Taylor co-founded Sierra in 2023. The company builds and implements AI agents for customer service. AI agents can carry out tasks autonomously on behalf of their users.
Shares of Salesforce fell 5% Thursday after the company reported weak guidance and concerns lingered about how AI is affecting software companies.
Sierra said its agents are already being used by “hundreds of millions of people” to help with tasks like refinancing homes, ordering lunch, delivering furniture, understanding insurance deductibles and fixing technology, among other things.
Greenoaks led Sierra’s latest funding round, the company said. Its valuation more than doubled from its most recent raise in October.
“We’re in this for the long term,” Sierra said in a blog post on Thursday.
The company said it will use its fresh funding to invest in its platform and focus on domestic and international expansion.
Sierra’s funding follows a flurry of other major AI raises in Silicon Valley. Earlier this week, Anthropic announced it had closed a $13 billion funding round at a $183 billion post-money valuation.
WATCH: Sierra co-founder Bret Taylor on AI agents’ role in an evolving global landscape
-
Sports3 years ago‘Storybook stuff’: Inside the night Bryce Harper sent the Phillies to the World Series
-
Sports1 year agoStory injured on diving stop, exits Red Sox game
-
Sports2 years agoGame 1 of WS least-watched in recorded history
-
Sports2 years agoMLB Rank 2023: Ranking baseball’s top 100 players
-
Sports4 years ago
Team Europe easily wins 4th straight Laver Cup
-
Sports2 years agoButton battles heat exhaustion in NASCAR debut
-
Environment2 years agoJapan and South Korea have a lot at stake in a free and open South China Sea
-
Environment11 months agoHere are the best electric bikes you can buy at every price level in October 2024