Tencent and Alibaba in Talks to Invest in DeepSeek at $20B+ Valuation — First External Funding Round

Bloomberg and The Information reported that Tencent and Alibaba are in active talks to participate in DeepSeek's first-ever external funding round, targeting a valuation above $20 billion. DeepSeek seeks to raise more than $300 million, with Tencent proposing acquiring up to a 20% stake. DeepSeek is owned by High-Flyer (幻方科技), a Zhejiang-based quantitative hedge fund founded by Liang Wenfeng. Talks remain fluid with no deal finalized as of April 25. The fundraise represents a strategic inflection point: since its founding, DeepSeek has operated as a bootstrapped research lab funded entirely by High-Flyer's trading profits, allowing unprecedented research freedom unconstrained by commercial investors. A $20B+ valuation would make DeepSeek one of China's most valuable AI startups — comparable to Zhipu AI and Moonshot AI but with a smaller operational footprint. The timing coincides with DeepSeek's April 24 V4 model launch, giving the lab maximum negotiating leverage. Both Tencent and Alibaba have strategic motivations beyond financial return: DeepSeek's open-source models compete directly with their own AI labs (Tencent's Hunyuan and Alibaba's Qwen), making investment partly a defensive move to maintain distribution access. The deal structure being discussed would reportedly preserve DeepSeek's research independence and open-source approach — conditions Liang Wenfeng has consistently prioritized over commercial optimization.