DeepSeek Secures $15B Windfall as US Civilian Agencies Cut Ties
A massive capital injection arrives for the Hangzhou-based AI lab just days after Washington ordered federal civilian departments to strip its software from their networks.
By Bianca Zhao ·
For consumers and businesses in the Southwest and beyond, the AI landscape is shifting rapidly. Just 48 hours after the U.S. government mandated that federal civilian agencies remove DeepSeek’s technology due to security risks, the Chinese AI lab reportedly closed a funding round of approximately $15 billion. This move marks one of the largest capital raises in China’s history, signaling a bold push forward despite the geopolitical headwinds.
The timeline of these developments has been compressed. In June, DeepSeek secured over $7 billion at a $50 billion valuation. By July, reports indicated the company was seeking an additional $1.5 billion at a valuation near $71 billion, with plans for a potential initial public offering in China as early as next year. Now, with the U.S. restrictions in place, the company has moved to lock in even more capital.
According to Bloomberg, potential backers for this latest round include Tencent, the powerhouse behind WeChat, and CATL, a major Chinese battery manufacturer. These investors are joining a growing list of entities pouring billions into AI firms globally to maintain a competitive edge in the sector.
DeepSeek is reportedly using this influx of cash to expand its AI infrastructure and develop open models for both domestic and international markets. This aggressive spending strategy may intensify competition among rival companies in China. The startup, founded in 2023 by Liang Wenfeng, previously co-founded the quantitative hedge fund High-Flyer. Liang is estimated to retain an 81.6% stake in the company’s Chinese operating entity, per data analyzed by WireScreen.
The company first captured global attention in early 2025 with its free, open-weight reasoning model, which challenged the dominance of American AI providers. That initial momentum has helped lay the groundwork for its current scale, even as it navigates new regulatory challenges in the West.
The broader market is reflecting a similar trend of heavy investment. Moonshot AI, developer of Kimi, raised $2 billion in May at a $20 billion valuation. Manus AI secured over $500 million earlier this month. Meanwhile, Zhipu AI and MiniMax, which both listed on the Hong Kong stock exchange in January, currently hold market capitalizations of roughly $29 billion and $7.2 billion, respectively.
As of today, DeepSeek has not yet issued a formal response to requests for comment regarding the new funding and the recent U.S. restrictions.
Source: TechCrunch · original report published
