DeepSeek is currently negotiating its first-ever venture capital round, and within just a few weeks, its potential valuation has skyrocketed from $20 billion to $45 billion, according to reports from the Financial Times and Bloomberg. The Chinese AI lab first gained widespread attention in early 2025 after releasing a large language model that was trained using a fraction of the computing power and at a fraction of the cost of major U.S. models like those from OpenAI and Anthropic. Since then, it has managed to keep pace with leading global models in areas such as reasoning and coding, while maintaining an open-weight approach—making its versions freely available on Hugging Face.

Founded by Liang Wenfeng, a Chinese hedge fund billionaire who controls nearly 90% of the company, the lab has historically not sought outside investors, the FT reports. However, as competitors began poaching DeepSeek’s researchers, Liang decided to raise funds to offer employees shares in the company, sources told the FT. Bloomberg reports that the round is expected to be led by China Integrated Circuit Industry Investment Fund, a state-backed investment vehicle. China is actively funding homegrown AI technology to reduce its reliance on U.S. technology, particularly chips. DeepSeek has been optimized to run on chips manufactured by Chinese hardware giant Huawei Technologies, a combination seen as a powerful force for the nation’s efforts to develop AI capable of rivaling the United States.

Additionally, Bloomberg reports that China’s cloud giants Tencent and Alibaba are also reportedly in talks to participate in the funding round. DeepSeek could not be immediately reached for comment.