DeepSeek Plans New Funding at $74 Billion Valuation Ahead of Potential IPO, Sources Say

Chinese artificial intelligence startup DeepSeek is planning a new fundraising round at a valuation of approximately 500 billion yuan ($74 billion) and is considering a potential initial public offering on the mainland, according to a Reuters report citing people with knowledge of the matter.

Back-to-Back Funding Rounds

The move comes just weeks after the Hangzhou-based company raised about $7.4 billion in June at a reported post-money valuation of around 450 billion yuan. However, subsequent filings from two Chinese investors suggested a lower valuation of 350.88 billion yuan, or about $52 billion, at that time.

For the new round, DeepSeek is reportedly looking to raise as much as 50 billion yuan. The company has also begun early discussions for a potential IPO on Shanghai’s Nasdaq-style STAR Market, with an internal target to file this year, the sources said. All plans are reportedly in the early stages and subject to change.

Fueling AI Ambitions

The rapid succession of funding plans highlights both strong investor appetite and the immense capital required to compete at the forefront of the AI industry. The capital is needed to cover the high costs of computing power, data center capacity, and engineering talent.

DeepSeek, which gained global attention for its low-cost AI models, plans to use the funds for significant expansion. This includes doubling its staff and developing its own proprietary AI inference chips, a project that involves hiring specialized chip-design engineers, according to the report.

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Context and Competition

Historically, DeepSeek was an outlier in China's AI scene, with founder Liang Wenfeng largely self-funding the company through his quantitative hedge fund, High-Flyer. The recent shift to external financing reflects the escalating costs of staying competitive against domestic tech giants like ByteDance and Alibaba, as well as other well-funded AI startups such as Z.ai, Moonshot, and MiniMax.

Key investors in the June round reportedly included:

• Founder Liang Wenfeng, who personally committed 20 billion yuan
• Tencent Holdings, which invested 10 billion yuan
• Battery giant CATL, which contributed 5 billion yuan

Other backers included China’s state-backed national AI fund, NetEase, and JD.com. The participation of the government fund underscores the strategic importance of companies like DeepSeek to Beijing's goal of fostering domestic technology champions.