Chinese AI lab DeepSeek is in advanced talks to raise up to 50 billion yuan ($7.35 billion) in what would be the largest single funding round ever for a Chinese artificial intelligence company. This funding could value the previously self-funded startup at as much as $50 billion, a figure that has increased from $10 billion only weeks ago, according to reports from The Information and Reuters.
The National Artificial Intelligence Industry Investment Fund, an $8.8 billion state-backed fund established in early 2025, is reportedly leading the funding negotiations. The China Integrated Circuit Industry Investment Fund, also known as “Big Fund III,” is involved, with a focus on fostering semiconductor and AI independence from U.S. technology, as first reported by the Financial Times.
Tencent and Alibaba are also in discussions to participate in the funding round, according to Bloomberg. Tencent had initially proposed acquiring up to a 20% stake in DeepSeek, though the company’s founder, Liang Wenfeng, who controls nearly 90% of DeepSeek, has been hesitant to give up that level of ownership. Liang plans to invest up to 20 billion yuan ($2.94 billion) personally in the round.
The funding effort represents a significant shift for DeepSeek, which has historically rejected outside capital since its founding by Liang, a hedge fund billionaire. The company gained attention for developing AI models optimized for Huawei Technologies’ chips rather than U.S. semiconductors. Recent valuation discussions for DeepSeek escalated from $10 billion to $30 billion and then to approximately $50 billion as state interest increased.
Funds raised in this round will be used to expand DeepSeek’s computing infrastructure and enhance employee compensation. A primary motivation for this funding push is to provide employees with equity stakes amid increased competition for talent, as sources indicated competitors have been poaching DeepSeek researchers. The company also intends to accelerate commercialization and model releases, with an upgraded V4.1 model expected in June.
If completed, this funding round would surpass recent AI fundraises in China and position DeepSeek among the world’s most valuable AI startups, alongside U.S. rivals backed by substantial capital resources.
