Moonshot AI secured a $35 billion valuation after raising a larger-than-anticipated $3.5 billion in a just-closed round of financing, riding the momentum from a breakthrough Kimi K3 model that sent ripples through Silicon Valley.

The Beijing-based startup managed to secure far more than the $1 billion to $2 billion it initially targeted, people familiar with the matter said, asking not to be identified to talk about private information. Moonshot is now reaching out to potential backers for a new funding round at a $50 billion pre-money valuation, aiming to secure capital a final time before an initial public offering in Hong Kong as soon as this year. A Moonshot spokesperson didn’t respond to an emailed request for comment.

The Chinese startup’s frenetic deal-making underscores the enormous investor interest in a private firm that this month leapt to the forefront of the industry with the K3, which approached the performance of frontier models by Anthropic PBC and OpenAI. Its debut triggered a selloff in tech stocks and was hailed as another “DeepSeek moment” — providing evidence that the country’s AI labs can keep pace with the U.S. despite export curbs and computing constraints.

Moonshot on Monday released its weights — the numeric values the model learned during training — — allowing developers to download, tweak and host the technology freely.

Moonshot’s success has also thrust it into the center of U.S.-Chinese tensions. A White House official accused the company of training the K3 on restricted Nvidia Corp. chips, while reiterating allegations of distillation — the practice of extracting outputs from top competitors to boost performance. Moonshot has not responded to requests for comment on the matter.

Moonshot developed the K3 with 2.8 trillion parameters — a rough measure of AI complexity — making it the world’s largest open-weight model at a time when U.S. rivals keep their technology proprietary. The model also features a 1 million-token context window, enabling it to process massive documents or codebases in a single prompt.

Moonshot achieved $300 million of annual recurring revenue — a gauge of future sales — in June, jumping from $200 million in April, Bloomberg News reported earlier. Since the K3’s launch, daily sales have surged at least six times, one person familiar with the matter has said.

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