DeepSeek, the Hangzhou-based artificial intelligence startup that became one of China’s most closely watched AI names, is close to finalising a funding round of about 50 billion yuan, or $7.4 billion, in what could become one of the country’s largest startup financings.
The scale of the proposed deal is striking, but the message behind it may be even bigger. At a time when global AI companies are under pressure to convert huge technology spending into revenue, DeepSeek appears to be raising capital without moving away from the research-first identity that helped make it stand out.
The funding round is being backed by some of China’s most influential corporate and institutional players. Tencent Holdings and Contemporary Amperex Technology Co. Ltd., better known as CATL, are the two biggest investors in the group that has begun signing term sheets. The state-backed National Artificial Intelligence Industry Investment Fund is also taking part, giving the deal a clear signal of policy importance from Beijing.
External investors are expected to put in around 30 billion yuan at a valuation of roughly 350 billion yuan. DeepSeek founder Liang Wenfeng is also personally investing about 20 billion yuan, adding a rare founder-led conviction to a round already notable for its size.
Tencent is understood to be taking the largest single investment position, with about 10 billion yuan going into a. For the WeChat operator, the move could strengthen its push to bring AI deeper into its own products and services. Alibaba Group Holding was involved in early discussions but ultimately did not invest.
The deal has not been publicly confirmed by the companies involved. Tencent and CATL declined to comment. Alibaba and DeepSeek did not respond to requests for comment. The Ministry of Finance, which administers the National AI Fund, also did not respond to a faxed request for comment.
DeepSeek’s rise has not followed the usual startup script of aggressive monetisation first and technology depth later. The company built its reputation around technical breakthroughs and open-source AI models, including a 2025 model that was described as matching the capabilities of Silicon Valley offerings at a fraction of the cost.
That is why this fundraise matters beyond valuation headlines. It suggests that some of China’s biggest technology and industrial backers are willing to fund a company that has openly prioritised advanced AI research over short-term commercial returns.
DeepSeek’s senior management has told potential investors that the company will continue to focus on groundbreaking AI research. Liang has also pledged in at least one investor meeting that the company will keep developing open-source AI models while pursuing the broader goal of artificial general intelligence.
His position is clear: DeepSeek’s main ambition is to push the boundaries of the technology, not rush into monetisation.
That approach places the company in an unusual position. Around the world, AI firms are facing increasing pressure to justify the enormous cost of computing infrastructure, model training and talent. OpenAI and Anthropic are exploring different ways to create revenue and prepare for larger financial milestones. In China too, AI companies are being watched closely for their ability to turn technical promise into business outcomes.
DeepSeek, at least for now, is asking investors to back a longer game.
The involvement of the National Artificial Intelligence Industry Investment Fund adds a political and strategic layer to the funding round. It shows that DeepSeek is not being treated merely as another startup trying to scale. It is being viewed as part of China’s wider AI push.
China’s AI industry has been trying to close the gap with American leaders while also building its own ecosystem around domestic models, open-source tools and local computing capacity. DeepSeek’s work fits directly into that ambition.
The company’s open-source approach has already influenced the broader Chinese AI market. Chinese open-source models have gained global attention because of their accessibility, with DeepSeek helping popularise that path. Alibaba’s Qwen platform has also used the open-source model strategy effectively.
For Beijing, backing DeepSeek is not just about funding a company. It is about strengthening a domestic AI champion at a time when artificial intelligence has become central to technology leadership.
Liang Wenfeng’s personal investment of about 20 billion yuan makes this deal especially unusual. Founder participation at that level gives the round a different tone from a standard institutional raise.
Liang is already known in China’s AI scene as both a hedge fund manager and an AI pioneer. DeepSeek was founded in 2023 and is owned by his hedge fund, Zhejiang High-Flyer Asset Management. The company has moved quickly from being a relatively little-known Hangzhou startup to one of the most closely watched names in the global AI race.
DeepSeek is also expanding into agentic AI, a category focused on software that can carry out tasks with less human intervention. That shift comes as the industry moves beyond chatbots and text generation toward systems that can plan, execute and assist with more complex workflows.
Still, the company’s core message to investors appears unchanged: research comes first.
A different kind of AI capital story
The global AI market is full of huge funding rounds, but DeepSeek’s proposed raise stands apart because of its timing and philosophy. Many AI companies are now being judged by how fast they can generate revenue. DeepSeek is attracting capital while openly stating that its priority is long-term technical progress.
Ambitious, because it could give DeepSeek the financial strength to compete more directly with the world’s best-funded AI labs. Risky, because investors are placing a large bet on research outcomes in a sector where costs are high, timelines are uncertain and commercial models are still evolving.
For China, however, the logic is clear. DeepSeek has already become a symbol of domestic AI capability. A $7.4 billion funding round would give that symbol much deeper financial backing.
The deal has not closed yet, and the final terms may still matter. But even at the term-sheet stage, the direction is visible. DeepSeek is no longer just a breakout AI startup. It is becoming a national-scale technology bet, backed by corporate capital, state-linked investment and its founder’s own money.
In the AI race, that combination sends a powerful message: China is willing to fund patience, research and open-source ambition, even as the rest of the industry races to prove commercial returns.
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