DeepSeek raises US$15bil to challenge US AI leaders

Chinese AI startup DeepSeek has raised approximately $15 billion in its latest fundraising round, marking one of the country's largest-ever and signaling its ambitions to compete globally with AI leaders like Anthropic PBC and OpenAI. Based in Hangzhou, the firm increased its financing target multiple times during investor talks, starting from ¥50 billion and reaching the final amount of ¥80 billion.

Notable investors in the round included battery giant Contemporary Amperex Technology Co Ltd (CATL) and WeChat operator Tencent Holdings Ltd.

DeepSeek's fundraising comes after triggering a $1 trillion market meltdown in 2025 with its ability to compete with Silicon Valley's leaders at a fraction of their cost. Despite its accomplishments, the startup has far less financial firepower than US AI leaders Anthropic and OpenAI, both of which have raised over $100 billion.

The funding round also highlights DeepSeek's aggressive expansion plans, with the firm investing in AI data centers and developing more open-source models for use in China and abroad. The company has gained traction in the US and other overseas markets with its high-performance, low-cost models, which have put pressure on domestic competitors. In September, DeepSeek's release of V4.1 Flash led to a decline in share prices of local rivals MiniMax Group Inc and Z.AI Co.

Chinese tech giants Alibaba Group Holding Ltd, ByteDance Ltd, and others have also introduced low-cost AI services, often open-sourced to allow customers to modify them as needed. A benchmark chart from Artificial Analysis, dubbed the "DeepSeek death zone," suggests that competitors struggle to survive if they cannot match DeepSeek's performance or offer lower prices.