Chinese venture capitalists and industrial firms are heavily investing in developers of advanced robotic hands, a critical component for humanoid robots. This funding surge is rapidly increasing start-up valuations in the competitive global market.

Venture capitalists and industrial giants in China are aggressively backing developers of dexterous robotic hands – the toughest bottleneck in the global humanoid hardware arms race – in a funding blitz that is rapidly driving up start-up valuations. The latest capital injection was announced on Friday by Xynova. The Hangzhou-based start-up said it had completed a series A round from investors including the venture arms of smartphone maker Xiaomi and electric vehicle giant Li Auto, bringing...