Kimi K3 had created waves after coming close to matching the capabilities of US frontier models, and its parent company has seen its valuation jump after its release.
Moonshot AI has closed a $3.5 billion funding round that values the Beijing-based lab at $35 billion, according to a Bloomberg News report. The number blows past what the company was originally targeting, which people familiar with the round had put at somewhere between $1 billion and $2 billion. Investors clearly wanted in for more than Moonshot was asking.
The company isn’t done raising either. Moonshot is reportedly already in talks for another round, this time at a $50 billion pre-money valuation, according to the report. If that closes, it would mark yet another leg up in a valuation curve that has looked almost vertical over the past year
The timing lines up neatly with the release of Kimi K3, Moonshot’s largest and most capable model yet. The 2.8 trillion parameter model landed to a wave of attention after Moonshot said it trailed only Claude Fable 5 and GPT 5.6 Sol in its own internal evaluations. Independent benchmarking backed that up too, with Artificial Analysis placing K3 third overall on its Intelligence Index, just a couple of points behind the two closed frontier leaders. On narrower tests, Kimi K3 has actually come out on top. It beat both Fable 5 and GPT 5.6 Sol on the Frontend Code Arena leaderboard, and separately topped them on Next.js code generation and migration tasks, a result that resonates directly with developers who ship code for a living.
Moonshot also went ahead and open-sourced K3’s weights on Hugging Face, along with a technical report and a set of infrastructure tools used to train the model. The release reportedly became the fastest-growing model launch the platform had seen, racking up thousands of likes within half an hour of going live. For a lab competing directly with the best closed models out of Silicon Valley, giving the model away for free while still matching those systems on benchmarks has been central to how Moonshot has built its reputation over the past year.
None of this is happening in isolation. Chinese AI labs have been racing toward Hong Kong listings and eye-watering valuations all year. Z.AI’s stock is now trading close to 10x its IPO price since going public in January, and MiniMax has filed confidentially for its own Hong Kong listing. Moonshot is reportedly plotting a similar path, planning to raise this capital before pursuing an IPO in Hong Kong later this year.
Whether the market rewards Moonshot the way it has rewarded Z.AI remains to be seen. What’s clear right now is that investors are treating Kimi K3’s benchmark performance as a genuine signal of what Moonshot can build next, and they’re willing to pay a steep premium to be part of it before the company goes public.