In China, cities like Yiwu reveal a less known side of the AI boom

Written by 36Kr

“For elite founders, deciding whether to target the domestic or international market—where to raise funds, which users to serve, where to register the company—is a cautious decision. For grassroots entrepreneurs, there’s only one correct answer: go where the money is.”

“But to find the second wave, you needed to venture away from Beijing, Shanghai, and Shenzhen—into less prominent places.

Take Yiwu, for example, a county-level city famous for its small commodity market, hardly associated with high-tech innovation. The winds of AI didn’t sweep into some investment committee meeting room or plush office building here. Instead, walk into a fancy restaurant, and you’d likely see young locals with tablets and wine glasses, demonstrating AI-generated product images for shopkeepers in a private room.

According to Tianyancha, the number of AI startups in Beijing and Shanghai declined on a percentage basis between 2023 and 2024, while it increased in non-first-tier cities such as Shanxi, Hebei, Henan, and Hubei.”