DeepSeek Nears $12 Billion Round, Oversubscribed at 100 Billion Yuan Cap

Chinese AI startup DeepSeek is set to raise more than 80 billion yuan ($11.93 billion) in its latest funding round, a person with knowledge of the matter told Reuters, with the final tally potentially reaching 100 billion yuan.

The round has drawn massive interest from existing and new investors. Committed capital already exceeds DeepSeek's original target of 50 billion yuan, the source said. The company expects to wrap up the fundraising in October, according to the source and a second person familiar with the matter. Both declined to be identified because the information is confidential.

Bloomberg first reported on Tuesday that the startup is close to securing at least 80 billion yuan. CATL, the Chinese battery maker, and Tencent Holdings have committed amounts that rank among the largest in the round, Bloomberg added.

DeepSeek did not immediately respond to an emailed request for comment. Tencent and CATL also did not respond to Reuters' requests for comment.

How did the round take shape?

DeepSeek kicked off the fundraising in July, targeting a valuation of 500 billion yuan ($74 billion), Reuters reported. The launch came just one month after the company raised about $7.4 billion in its maiden external funding round.

The pace is unusual. Two mega-rounds inside six months, with the second oversubscribed, signal that investors are competing for exposure to one of China's highest-profile AI developers ahead of a public listing.

What comes next for DeepSeek?

DeepSeek has hired CITIC Securities to prepare for a potential initial public offering on Shanghai's STAR Market, Reuters reported last month. The timing, valuation and fundraising size for the IPO remain undecided.

The new capital functions as a war chest ahead of that listing, according to the person familiar with the matter.

On the product side, the company released its latest model, DeepSeek-V4.1-Flash, in September. The company said the model was designed for greater capability, faster inference, higher throughput and scaling to larger models.

Where does Huawei fit in?

DeepSeek recently partnered with Huawei Technologies to develop programming tools optimized for Huawei's Ascend AI chips. The collaboration highlights China's broader push to reduce reliance on Nvidia's AI ecosystem — a strategic priority as U.S. export controls restrict access to top-end American chips.

The partnership pairs one of China's leading AI model developers with its most advanced domestic chipmaker. If the combined capital from this round approaches 100 billion yuan, DeepSeek would hold one of the largest private funding reserves in the global AI sector, at a moment when chip supply chains, not just cash, are shaping competitive outcomes.

($1 = 6.7045 Chinese yuan)