"Back in 2015, you get a lot of data points. Now, we're moving into the second phase where companies are trying to capture data, analyse the data...and monetize it," a KPMG China partner, Lyndon Fung, told CNBC's "Street Signs" on Thursday.
He cited self-driving cars as an example of artificial intelligence technology that is poised to transform lives.
In the report released last week, KPMG found investment by VCs in China reached a record high in 2016, despite a global slowdown.
According to the data, investment by VCs in China increased 19 percent to $31 billion in 2016 from 2015, although deal volumes fell 42 percent to 300 from 513 in the same period. This is due to mega-deals recorded early in the year.
Global VC investment fell 9.4 percent to $127 billion in 2016 against a 24 percent slide in deal counts to 13,665.
VC investment in Asia remained unchanged at $39 billion in 2016 with deals down to 1,742 from 2,266 in 2015.
KPMG said it expected the global investment momentum to continue, particularly in the fields of AI, robotics and the internet-of-things, which caught investor attention in the second half of 2016.
The consultancy also expects outbound VC investment from China to continue at a "solid pace" as companies look to acquire technologies for use in the world's second largest economy. The U.S.is likely to continue to get most of the outbound investment, while Canada and Israel will also be of interest.
The drive for innovation in China is spurred by a central government mandate, which is prompting provincial governments to acquire companies and invest in start-ups, the report noted.