DeepSeek in Talks for $300M Funding at $10B Valuation

Chinese artificial intelligence startup DeepSeek is in early discussions to raise at least $300 million in external funding for the first time, a move that could value the company at more than $10 billion amid escalating costs to develop advanced AI models.

The two-year-old firm, based in China and previously funded solely by quantitative hedge fund High-Flyer Capital Management, has long prioritized research independence over rapid commercialization. That approach allowed DeepSeek to focus on efficiency, but surging demand for its models and application programming interfaces has strained its infrastructure. Officials familiar with the matter said the company needs additional graphics processing units, servers, and computing power to sustain operations and compete globally. Training and deploying cutting-edge reasoning systems and agent-based AI requires substantial resources, even for a team renowned for cost-effective innovations.

DeepSeek's breakthrough came in early 2025 with the release of its R1 reasoning model, which performed comparably to leading systems from U.S. developers while costing far less to build. The model was trained for approximately $5.6 million to $6...