Chinese AI giant DeepSeek eyes $7.4 billion funding round at up to $59 billion valuation

Chinese artificial intelligence startup DeepSeek is preparing to raise about 50 billion yuan, or $7.4 billion, in its first funding round from investors including Tencent Holdings and CATL, people familiar with the matter said.

The round could value DeepSeek at between 350 billion yuan and 400 billion yuan, equivalent to $52 billion to $59 billion, after the investment, the people said, declining to be identified because the information is confidential.

DeepSeek founder Liang Wenfeng has committed 20 billion yuan of his own money to the round, the people said.

Tencent is considering an investment of 10 billion yuan, while battery maker CATL is looking at 5 billion yuan, which would make them the largest external investors in the fundraising.

DeepSeek is also in final talks with China’s national artificial intelligence fund, gaming developer NetEase and e-commerce company JD.com, according to the people.

They said the planned number of investors was fewer than 10.

DeepSeek, Liang, NetEase, JD.com and the China Integrated Circuit Industry Investment Fund, which is the main backer of the national AI fund, did not immediately respond to Reuters’ requests for comment.

Tencent and CATL declined to comment. IDG Capital declined to comment, while Monolith Capital did not respond to a request for comment.

Hong Kong-headquartered IDG Capital and Monolith Capital are also among the prospective investors, the people said.

DeepSeek became one of China’s leading AI companies after its V3 and R1 models drew attention in Silicon Valley last year and raised questions over US assumptions about China’s artificial intelligence capabilities.

The planned investment reflects China’s efforts to strengthen its domestic AI industry across models, computing infrastructure and energy systems required to support AI workloads.

CATL, known for its role in the electric vehicle battery supply chain, has recently been exploring AI data centres, including power equipment and energy storage solutions.

Tencent has been promoting its own AI model, Hunyuan, but remains behind domestic market leaders including ByteDance’s Doubao and DeepSeek.

A closer relationship with DeepSeek could help Tencent compete with Alibaba, which has focused on its in-house Qwen AI model.

The people said DeepSeek is expected to complete the round within the next couple of weeks, although the financial terms could still change.

The company has not made any statement on whether it plans to pursue an initial public offering in the future.