(Yicai) Sept. 17 -- The venture capital arm of leading Chinese private equity firm Hillhouse Capital and state-owned Pudong Venture Capital have jointly set up a fund worth CNY2 billion (USD281.4 million) to build an innovation town for 1,000 artificial intelligence companies in Shanghai.

The fund, launched by GL Ventures and Pudong Venture Capital, will focus on broad AI technology innovation and AI tech application across various scenarios, according to a press conference held yesterday. It will also support the development of the Zhangjiang AI Innovation Town and help cultivate AI unicorns. 

The AI town will be located in Zhangjiang Science City in Shanghai's Pudong New Area and cover an area of 2 square kilometers, including 700,000 square meters of industrial space, 1 million sqm of commercial supporting facilities, and 7,000 homes for talents. The goal is to create an integrated industrial ecosystem that combines research and development, ecology, application, and living functions.

The Zhangjiang AI Innovation Town will gather 500 AI companies and cultivate three to five world-leading firms by 2027, according to the plan. In addition, it should host 1,000 AI companies and be worth hundreds of billions of Chinese yuan (tens of billions of US dollars) by 2030, becoming a globally influential AI innovation and industrial center.

The new fund will ally with the AI Seed Fund under Pudong Venture Capital to make joint investments, supporting the development of the new AI town, Yicai learned. The CNY2 billion Pudong AI Seed Fund was launched at the World AI Conference in July, focusing on investing in startups.

Pudong is one of China's first AI innovation and application pilot zones, with the size of the local sector exceeding CNY160 billion (USD22.5 billion) as of the end of last year, accounting for nearly 40 percent of Shanghai's total. It has attracted more than 600 leading AI firms, covering intelligent terminals, autonomous driving, education, finance, cultural media, the new economy, and other areas.,

Shanghai established three major leading industry Fund of Funds worth a total of CNY100 billion (USD14.1 billion) in July last year to accelerate the cultivation of emerging industries, focusing on integrated circuits, biomedicine, and AI. Among them was the CNY22.5 billion (USD3.2 billion) AI FOF.

Editors: Dou Shicong, Martin Kadiev