DeepSeek Is Now Most Valuable AI Startup in China

“China's DeepSeek raised more than $7.4 billion in its first round of fundraising to support its costly development of artificial intelligence.

 

Investors valued the company at more than $50 billion, people familiar with the matter said, making it the country's most valuable AI startup.

 

Founder Liang Wenfeng, who held nearly 90% of DeepSeek before the financing round, invested around $3 billion in the biggest contribution of the fundraise, the people said.

 

Liang has retained control of the company via an unusual arrangement where most external backers put their money into a limited partnership that he manages, instead of investing directly into the business, some of the people said. Another requirement from the entrepreneur locks investors into holding their stakes for five years, the people added.

 

China's National Artificial Intelligence Industry Investment Fund, a government-backed fund set up early last year, invested around $150 million directly into DeepSeek, the people said. That is significantly scaled down from its initial plans, which at some point included leading the round, they said.

 

Other major investors included Chinese tech company Tencent, which invested around $1.5 billion, and battery maker Contemporary Amperex Technology, which put in $740 million, the people said.

 

Chinese e-commerce company JD.com and videogame developer NetEase also invested in the round, along with investment firms IDG Capital and Beijing-based Monolith Management, some of the people said.

 

The Information had earlier reported on the deal. DeepSeek, Tencent, CATL, JD.com, NetEase, IDG, Monolith and China's AI fund didn't immediately respond to requests for comment.

 

The Hangzhou-based AI lab has been seen as one of the front-runners in Beijing's AI race with the U.S. ever since it sent shock waves through Silicon Valley and Wall Street more than a year ago with a powerful, lower-cost model. The buzz has spurred faster AI adoption in China and boosted investor appetite for the country's homegrown startups.

 

DeepSeek has also aligned itself with Beijing's goal of becoming technologically self-sufficient. Over the past year, the startup has helped Chinese chip companies including Huawei make their products more capable of running powerful AI models.

 

According to people familiar with the matter, Liang has recently promised investors that his lab would continue to pursue artificial general intelligence -- which can theoretically match or beat human thinking -- and develop open-source technology.

 

DeepSeek plans to use the new capital to advance research and development as well as to expand computing infrastructure, some of the people said.

 

With U.S. trade restrictions curbing China's access to high-end computing chips needed to develop AI, DeepSeek is likely also hoping to secure more domestic computing power.” [1]

 

1. DeepSeek Is Now Most Valuable AI Startup in China. Huang, Raffaele; Qu, Tracy.  Wall Street Journal, Eastern edition; New York, N.Y.. 17 June 2026: B4.