Overview
- DeepSeek has started its first outside raise, with The Information reporting that Tencent and Alibaba are pursuing stakes at a valuation above $20 billion, a figure the company has not confirmed.
- The target valuation reportedly doubled from about $10 billion within days, and the size of the round has grown beyond an initial plan to raise at least $300 million.
- Sources told the South China Morning Post that DeepSeek aims to sell no more than 3% of its equity to set a clear market price for employee stock options and slow poaching by rivals.
- Investors described a preference for state-backed and industrial partners that can provide computing resources, including funds tied to China’s so‑called Big Fund III.
- The lab’s founder previously bankrolled the company and spent about $5.6 million training its DeepSeek‑V3 model, but wider rollout brings ongoing compute bills and U.S. limits on Nvidia chips that could push work toward domestic hardware like Huawei’s.