Chinese artificial intelligence startup DeepSeek is preparing a primary funding round that could raise about 50 billion yuan (roughly $7.4 billion). After the transaction, the company's valuation is estimated by sources to fall between 350 and 400 billion yuan (approximately $52–59 billion). Insiders who requested anonymity said the financing could close within weeks, although the financial terms may still change.
Investors reportedly considering participation include Tencent and Contemporary Amperex Technology Co. Limited (CATL). DeepSeek's founder, Liang Ven-feng, has pledged 20 billion yuan of his own capital. Among external backers, Tencent is said to be considering a 10 billion yuan investment and CATL about 5 billion yuan, which would make them the largest external partners.
DeepSeek is also in advanced talks with a Chinese state AI fund, the NetEase gaming giant, and the e-commerce company JD.com; sources expect the number of participating partners to remain under ten. Hong Kong–headquartered IDG Capital and Monolith Capital are also reported to be potential entrants into the investor group.
Why DeepSeek matters
DeepSeek became one of China’s leading AI companies early last year after its V3 and R1 models drew recognition in Silicon Valley, challenging prior assumptions about the quality of Chinese AI development. The composition of the investor group reflects China's aim to build a self-sufficient AI ecosystem that spans software models through the energy infrastructure required to run them.
CATL has recently moved toward serving AI data centers, positioning itself as a supplier of power equipment and energy-storage solutions to meet the rapidly growing energy demands of AI technologies.
Market context
While Tencent is developing its own Hunyuan model, sources say it currently lags domestic leaders such as ByteDance's Doubao and DeepSeek's models. A closer partnership with DeepSeek could help Tencent keep pace with Alibaba, which uses the Qwen model.
Next steps
The financing round may be completed in a matter of weeks, according to the reports, but final terms and the investor lineup could still change. Given the scale of the planned raise and the strategic profile of the participants, a successful closing would be a significant milestone for the development of China's AI ecosystem.
Source: Reuters
