By Rajwa Quasim
Chinese AI startup DeepSeek is set to raise at least $12 billion in a new funding round as it accelerates its expansion and builds computing capacity ahead of a potential initial public offering in 2027.
DeepSeek had initially planned to raise about 50 billion yuan, but investor interest increased following the release of its latest AI model. Analysts expect the final amount could reach 100 billion yuan, or roughly $15 billion.
Battery maker Contemporary Amperex Technology, or CATL, and Chinese tech giant Tencent Holdings have committed some of the largest amounts to the financing. DeepSeek began the current fundraising process in July, shortly after completing its first major external funding round of about $7.4 billion.
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The latest funding round is expected to close this month. Before the Bloomberg report, DeepSeek was expected to be valued at about 500 billion yuan, or approximately $74 billion, following the fundraising. The valuation could now be higher.
DeepSeek is one of China’s leading AI developers. The company gained broader public attention after releasing its R1 model in early 2025. The model challenged the assumption that developing advanced AI requires the enormous computing budgets associated with major U.S. technology companies.
Its latest V4 Flash model has attracted further attention for its performance relative to its cost. DeepSeek is competing with major AI systems developed by U.S. companies such as OpenAI and Anthropic. The latest funding could help the company expand its computing infrastructure as access to advanced AI chips remains a major issue in the U.S.-China technology rivalry.
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DeepSeek is building a large data center in Inner Mongolia and plans to deploy at least 160,000 high-end AI accelerators from Huawei Technologies. The company has also worked with Huawei to develop software optimized for its Ascend chips, making DeepSeek one of the companies seeking to reduce its reliance on Nvidia’s AI hardware.
Although the valuation and timing of a potential IPO have not been finalized, reports suggest DeepSeek has hired CITIC Securities to prepare for a possible listing on China’s domestic STAR Market.
DeepSeek began as an offshoot of founder Liang Wenfeng’s hedge fund, High-Flyer, which initially provided much of the company’s financial backing.
In meetings with investors, Liang has said the company will continue developing open AI models while pursuing the broader goal of artificial general intelligence. He has emphasized technological progress over immediate monetization.