DeepSeek set to raise $7.4 billion in first funding round, targeting valuation as high as $59 billion

China’s AI champion DeepSeek is preparing to raise about $7.4 billion in its first-ever funding round, a deal that could value the startup at up to $59 billion and rank among the largest private technology financings in China.

The fundraising marks a dramatic shift for the company behind the V3 and R1 models, which rose to global prominence without relying on outside venture capital. Investors expected to participate include Tencent and CATL, with founder Liang Wenfeng reportedly contributing roughly 40% of the total round himself.

“The fundraising could value the ‌company after the investment at between 350 billion yuan and 400 billion yuan, or between $52 billion and $59 billion,” Reuters reported, citing people who declined to be identified because the information is confidential.

The news comes less than two months after reports that Tencent and Alibaba were exploring investments in DeepSeek at a valuation exceeding $20 billion. If the current fundraising proceeds as planned, it would value the startup at up to $59 billion, underscoring investor demand for one of China’s most closely watched AI companies.

The fundraising reflects a broader shift in the AI industry, as companies race beyond chatbots toward AI agents capable of performing more complex tasks with less human intervention. Building those systems requires significantly more computing infrastructure, pushing companies worldwide to raise fresh capital and expand their access to chips, data centers, and energy.

DeepSeek has already signaled its ambitions in that direction. In April, the company unveiled its next-generation V4 model, describing it as a major advance for open-source AI. Independent evaluations suggest the model remains behind several leading competitors in both China and the United States, though it continues to rank among the strongest open-source offerings available.

Tencent and CATL back DeepSeek in a $7.4B funding round, valuing the AI startup at up to $59B

Liang is expected to contribute 20 billion yuan of his own money, accounting for roughly 40% of the total fundraising, according to people familiar with the discussions.

Among outside investors, Tencent is reportedly considering a 10 billion yuan commitment, with battery giant CATL exploring a 5 billion yuan investment. If finalized, the two companies would become DeepSeek’s largest external backers.

The startup is said to be in late-stage discussions with several additional investors, including China’s national artificial intelligence fund, gaming company NetEase, e-commerce giant JD.com, Hong Kong-based IDG Capital, and Monolith Management. Sources cautioned that investor participation and financial terms could still change before the round closes.

DeepSeek, Liang, NetEase, JD.com, Monolith Management, and the China Integrated Circuit Industry Investment Fund did not immediately respond to requests for comment. Tencent and CATL declined to comment.

China’s AI self-sufficiency push takes center stage

The investor lineup reflects a broader effort by China to strengthen domestic AI capabilities amid growing geopolitical and technological tensions with the United States.

CATL’s interest is particularly notable. The company dominates the global electric vehicle battery market but has increasingly focused on AI infrastructure opportunities, including energy storage systems and power solutions for data centers. As AI workloads consume more electricity, access to reliable energy infrastructure has become a strategic advantage.

Tencent’s involvement carries its own significance. The company has invested heavily in its Hunyuan AI model but remains behind domestic leaders such as ByteDance’s Doubao and DeepSeek. A closer relationship with DeepSeek could help Tencent strengthen its position as competition intensifies across China’s AI sector.

DeepSeek faces a different playing field than OpenAI and Anthropic

The proposed fundraising would rank among the largest private technology financings in China. Yet it remains far smaller than the massive capital raises recently secured by leading U.S. AI companies.

OpenAI reportedly raised $122 billion earlier this year, and Anthropic secured $65 billion last month. Those companies operate in financial markets with significantly deeper pools of private capital and greater access to advanced computing hardware.

DeepSeek faces a different set of constraints.

“Western export bans mean DeepSeek cannot access frontier American silicon. Without the ability to buy that hardware, they have no reason to match the multi-billion-dollar computing budgets of their U.S. rivals,” said Alfredo Montufar-Helu, managing director at Ankura China Advisors in Beijing.

Those restrictions have forced Chinese AI companies to pursue alternative strategies built around domestic supply chains, local investors, and homegrown infrastructure.

People familiar with the matter said DeepSeek expects to complete the funding round within the next several weeks.

The company has not publicly discussed plans for an initial public offering. That stands in contrast to OpenAI and Anthropic, both of which are preparing for eventual public market debuts.

For now, DeepSeek appears focused on a more immediate goal: securing the capital needed to compete in the next phase of the global AI race.

DeepSeek