DeepSeek, the Chinese AI lab that burst onto the scene in early 2025 by training a model on pocket change and a hamster wheel, is now in talks to raise its first venture capital round. According to the Financial Times and Bloomberg, the company's potential valuation has already tripled from $20 billion to $45 billion in just a few weeks. That's a faster growth rate than most people's anxiety about AI taking their jobs.
The lab, founded by Chinese hedge fund billionaire Liang Wenfeng, who owns nearly 90% of the company, had previously eschewed investors with the kind of independence usually reserved for cats. But now, facing the grim reality of competitors poaching its researchers, Liang has decided that employee stock options are a better retention strategy than just telling everyone they're doing God's work.
The round is reportedly led by the state investment vehicle China Integrated Circuit Industry Investment Fund, because nothing says 'free market' like a government-backed fund. China is eager to fund homegrown AI to bypass the pesky inconvenience of not being able to buy U.S. chips. DeepSeek's models are optimized to run on chips from Huawei Technologies, turning the duo into what experts call 'a powerful combo for national AI supremacy' and what everyone else calls 'a perfectly reasonable thing to bet $45 billion on.'
Cloud giants Tencent and Alibaba are also reportedly in talks to participate, presumably hoping to get in on the ground floor of something that might not be immediately banned by the U.S. government. DeepSeek could not be reached for comment, likely because it was too busy counting its theoretical billions.