Chinese AI startup DeepSeek, renowned for its affordable and competitive AI models, is now pursuing external capital as a surge in demand strains its infrastructure. Sources reveal that discussions with Alibaba and government-backed investors are underway while company executives aim to pivot toward a revenue-driven research strategy in Beijing offices.
According to a report published by The Information on Wednesday, which cited sources with knowledge of internal deliberations, the Chinese artificial intelligence startup DeepSeek is contemplating seeking money from outside sources for the very first time. The company has garnered interest from Alibaba, opens a new tab, and state funds.
The Chinese company startled the technology world in January with low-cost artificial intelligence models that can match or even exceed Western competitors at a fraction of the cost. This caused doubts to be raised about the lead that the United States has in the fight to dominate the technological arena.
But since then, there has been an increase in demand, which has resulted in outages at the little firm. According to the report, the company’s decision to contemplate using outside funds was driven by the requirement for additional artificial intelligence processors and servers to enable model development and handle rapidly expanding demand.
According to the article, China Investment Corporation and the National Social Security Fund have reached out to DeepSeek in order to discuss investment opportunities. Alibaba and DeepSeek did not respond to Reuters‘ requests for comment, and the funds could not be located immediately. Reuters also attempted to contact both companies.
According to the source, executives at the Chinese artificial intelligence company and High-Flyer Capital Management, the hedge fund that the company is a parent of, are also discussing the possibility of moving the company’s focus to the development of a business that generates income and eventually profits from research.
Rival OpenAI is considering transforming its for-profit division into a public benefit corporation in order to reduce the constraints imposed by its present parent organization, which is a non-profit organization, and to boost investing.
Recent meetings between President Xi Jinping of China and prominent figures in the private sector business community, such as Jack Ma, co-founder of Alibaba, and Liang Wenfeng, founder of DeepSeek, were held with the purpose of bolstering China’s economy and advancing the country’s technological capabilities.
Luis Gochoco is a seasoned managing editor and writer with over a decade of experience covering politics, technology, gaming, and entertainment news. With a keen eye for breaking stories and in-depth analysis, he has established himself as a trusted voice in digital journalism. Luis is one of the key forces behind the success of GameNGuide, contributing to 12 million views through engaging and high-traffic content. He also played a pivotal role in generating 8 million views on International Business Times, shaping the platform’s technology and gaming coverage.
Discover more from Today's Esquire
Subscribe to get the latest posts sent to your email.