Guangzhou's mushroom iot raises $30M Series C for energy-control AI
What's the deal? Guangzhou-based mushroom iotDealroom has a profile for this one. Try Dealroom → has closed a Series C round totalling 200 million CNY (about $30 million), the company confirmed. Existing backers including yunhui capitalDealroom has a profile for this one. Try Dealroom →, oriza seed capitalDealroom has a profile for this one. Try Dealroom →, and yuanhe yuandianDealroom has a profile for this one. Try Dealroom → re-upped in the raise, which was completed across C1 and C2 tranches.
What does it do? The startup applies "physical AI" to energy stations, letting software monitor and control equipment such as air compressors, chillers, water pumps, and cooling towers. Its Lingzhi AI models now oversee more than 260,000 energy devices online, handling tasks like stabilising air pressure overnight in place of human shift workers.
By the numbers: mushroom iot says it serves over 6,000 companies, has saved a cumulative 3.6 billion kWh of electricity, and can unlock close to 20% in energy savings versus non-AI methods. Founder Shen Guohui launched the company in 2016 after a decade in factory operations.
Why energy? The company splits users into supply-side and demand-side. Production processes vary by industry, but energy equipment is standardised worldwide, making it a more general entry point for AI. Comprehensive energy systems typically account for 30% to 60% of a plant's electricity use.
The moat: mushroom iot argues its edge lies in "dark data" — real operating data that flows only between devices and sensors and is never indexed by the wider internet. "Early on doing industrial SaaS, we stuck with public-cloud deployment, while some peers went private for short-term revenue," Shen said (translated from Chinese). "Now they want to buy that data and can't."
Real vs. fake: Shen sets two tests for genuine physical AI: a real-time visualisation interface that ties data to execution, and a vertical model registered with China's Cyberspace Administration. "Plenty of AI can write PowerPoint; few dare to control energy equipment," he said (translated from Chinese).
How it makes money: The company runs two models — an installation fee plus annual maintenance, or a share of energy savings under an AI-managed arrangement. It says it has already closed a commercial loop, and plans to explore a token-style, API-call pricing model as customers value unattended operation.
Investor view: yunhui capital partner Li Xing said management picked the right strategy years ago and moved fast on the large-model shift. "Such a team and company are worth backing continuously over the long term," he said (translated from Chinese).
The signal: With AI investors shifting from concept to execution, mushroom iot's round reflects appetite for physical AI that produces auditable results — in this case, a measurable electricity bill. Repeat backing from existing shareholders and high customer renewal rates, the company argues, carry more weight than the headline figure.
Image credit: Generated with Gemini
