China Unveils Three-Year Plan to Incubate 10,000 AI Startups by 2028

China's Ministry of Industry and Information Technology has released a three-year action plan (2026–2028) aimed at cultivating more than 10,000 technology and innovation-oriented small and medium-sized enterprises in the artificial intelligence sector. Announced on September 4, the directive outlines targets including more than 2,000 specialized 'little giant' firms, ten national-level industrial clusters, and dedicated public computing infrastructure. The policy also calls for state guidance funds to direct patient capital into seed-stage startups, promotes novel financing models such as equity-in-exchange-for-compute, and formally extends policy support to solo entrepreneurs utilizing AI tools.

This policy represents a targeted national push to build an ecosystem for grassroots AI startups in China. Rather than focusing solely on national champions or frontier foundational models, Beijing is directing resources toward application-layer, data-service, and computing infrastructure SMEs. By coordinating national funds, pooling state computing capacity, and validating lightweight operational models like one-person companies, the program aims to lower the capital barrier to commercializing AI across vertical industries.

China's Ministry of Industry and Information Technology has unveiled a targeted national roadmap to expand the country's artificial intelligence startup ecosystem, setting a goal to cultivate more than 10,000 innovative small and medium-sized enterprises over the next three years, according to a report by People's Daily. The Artificial Intelligence SME Entrepreneurship Support Plan (2026–2028), issued by the ministry's General Office on September 4, outlines an agenda to foster AI businesses across industry applications, data services, and intelligent computing. By 2028, the ministry aims to establish more than 2,000 specialized 'little giant' enterprises, alongside a cohort of high-growth gazelle and unicorn firms. The initiative also targets the high-standard development of 10 tech incubators, 10 national SME public service demonstration platforms, and 10 national-level specialized SME industrial clusters. To address resource bottlenecks facing early-stage teams, the directive emphasizes the provision of affordable, inclusive computing resources. Authorities plan to leverage national computing platforms to aggregate and elastically allocate computing capacity, establishing dedicated matching portals for small businesses. The plan also calls for developing edge computing facilities on demand and integrating computing and telecommunications networks to lower technical costs for commercial ventures. On financing, the policy instructs major state-backed vehicles—including the National SME Development Fund, the National AI Industry Investment Fund, and the National Integrated Circuit Industry Investment Fund—to mobilize private capital into early-stage venture funds. The goal is to establish a 'patient capital' network spanning seed, startup, and growth phases. Additionally, the ministry plans to add an AI investment matchmaking portal with online roadshows to the national SME cultivation platform, encourage venture backing for high-quality open-source initiatives, and explore novel arrangements such as exchanging computing capacity or data assets for startup equity. The roadmap also explicitly addresses the rapid rise of micro-scale entrepreneurs, urging local authorities to adopt inclusive and supportive policies toward agile one-person companies and solo practitioners using intelligent tools to build commercial products.