DeepSeek Nears $12B to $15B Funding Round Led by Tencent and CATL
Heavy investor demand following the launch of its V4 model family has pushed the Chinese AI lab's latest financing round toward 100 billion yuan.
Key takeaways
- DeepSeek is finalizing a funding round of at least 80 billion yuan ($12 billion), with signed term sheets potentially pushing the total near 100 billion yuan ($15 billion).
- Tencent and electric vehicle battery manufacturer CATL have committed some of the largest sums to the financing round.
- The fresh capital follows strong demand after recent model releases, including DeepSeek-V4.1-Flash and the V4 series.
- Proceeds will support extensive infrastructure investments, including a data center cluster running at least 160,000 Huawei AI accelerators in Inner Mongolia.
- DeepSeek is preparing for a corporate restructuring ahead of a targeted initial public offering in early 2027.
Chinese artificial intelligence startup DeepSeek is nearing the completion of a major funding round expected to secure at least 80 billion yuan (roughly $12 billion), according to a report by Bloomberg News via TNW. Strong investor appetite could push the final total to nearly 100 billion yuan, or approximately $15 billion, as the company scales compute infrastructure and prepares for a planned public market debut in early 2027.
The financing is led in size by WeChat operator Tencent Holdings and battery manufacturer Contemporary Amperex Technology Co. Ltd. (CATL), people familiar with the transaction told The Straits Times. DeepSeek originally aimed to raise about 50 billion yuan ($7.5 billion), but targets expanded after the release of its latest generative AI models demonstrated competitive performance at lower serving costs.
Surging Investor Demand and Valuation Targets
DeepSeek's initial fundraising target of 50 billion yuan was set at a targeted valuation of approximately 500 billion yuan, according to The Straits Times, or roughly $75 billion as reported by The Decoder. Demand increased notably after the laboratory rolled out its V4 model series, including the recent DeepSeek-V4.1-Flash architecture, which the company said was designed for faster inference and higher throughput at reduced API pricing.
The transaction follows a prior external funding round completed earlier in 2026 that raised approximately 50 billion yuan at a valuation between $52 billion and $59 billion, as detailed by TNW. In that earlier round, DeepSeek founder Liang Wenfeng contributed roughly 20 billion yuan of his personal capital, while Tencent invested 10 billion yuan and CATL added 5 billion yuan alongside backing from JD.com, NetEase, and China's national AI investment fund. Investors in that initial round committed funds through a limited partnership managed directly by Liang to maintain founder control.
Although the round was briefly paused over the summer following viral social media comments regarding hardware dependencies, discussions resumed quickly. DeepSeek also achieved a $1 billion annualized revenue run rate in September, according to figures shared with investors and reported by RuntimeWire.
Expanding Domestic Hardware and Infrastructure
A central focus for DeepSeek's new capital is building out custom compute resources and expanding domestic hardware clusters. DeepSeek is deploying a massive data center facility in Inner Mongolia that will house at least 160,000 AI accelerators from Huawei Technologies, The Straits Times reported.
To optimize these hardware deployments, DeepSeek partnered directly with Huawei to develop and release software programming tools designed specifically for Huawei's Ascend AI chips, according to The Economic Times. In addition to building on Ascend clusters, the lab is also developing its own dedicated inference silicon to decrease reliance on external chip suppliers, as reported by The Decoder.
DeepSeek originated as an offshoot of High-Flyer, a quantitative hedge fund established by Liang after studying engineering at Zhejiang University. The AI lab gained widespread international prominence in early 2025 with the launch of its R1 open-source model, and Liang has told investors he remains committed to providing freely available model weights while pursuing artificial general intelligence.
Road to an Early 2027 IPO
Once the current funding round officially closes, DeepSeek intends to initiate an internal corporate restructuring in preparation for an initial public offering targeted for early 2027, according to The Decoder and The Straits Times.
DeepSeek has secured CITIC Securities to work on a potential listing on Shanghai's STAR Market, according to TNW and The Economic Times, while other reports noted preparations for an offering window in the first quarter of 2027. Market timing, final valuations, and the exact share listing venue remain subject to final determination as deal terms are finalized.
Frequently asked questions
How much capital is DeepSeek raising in this round?
DeepSeek is securing at least 80 billion yuan (roughly $12 billion), with signed term sheets indicating the final tally could approach 100 billion yuan ($15 billion).
Who are the primary investors backing the financing?
The round is led in commitment size by Tencent Holdings and electric vehicle battery manufacturer CATL, who were also major participants in DeepSeek's earlier external financing round.
How will DeepSeek utilize the new funding?
The proceeds will fund model research and large-scale infrastructure, including a data center in Inner Mongolia equipped with at least 160,000 Huawei AI accelerators and the development of custom inference chips.
When does DeepSeek plan to go public?
DeepSeek plans to restructure following the round's completion to prepare for a potential initial public offering targeted for early 2027.
Sources
- DeepSeek reportedly nears $12bn funding round backed by Tencent and CATLTNW | Business · Oct 6, 2026
- CATL and Tencent back Deepseek's ballooning funding round as the AI startup eyes a 2027 IPOThe Decoder · Oct 6, 2026
- DeepSeek to raise at least $12 billion in Tencent-backed fundingEconomic Times · Oct 6, 2026
- DeepSeek set to raise at least $15 billion in Tencent-backed fundingThe Straits Times · Oct 6, 2026
- DeepSeek set to raise at least $12 bln in Tencent, CATL-led round- Bloomberginvesting.com · Oct 6, 2026
- DeepSeek seeks $12B after demand outstrips its funding targetRuntimeWire · Oct 6, 2026
- AI News Today: October 6, 2026 EditionAI Weekly · Oct 6, 2026
How this story was made: the newsroom picked it up from Google News, Techmeme and Reddit, gathered the full text of the sources above, and drafted it with AI assistance. Every factual claim was then checked against those sources before publishing (29 claims checked). Illustrations marked as AI-generated are not photographs. Spotted an error? Tell us.
Published October 7, 2026 at 00:43 UTC
