DeepSeek Halts Second Investment Round Suddenly... Focusing on IPO and AI Research

DeepSeek abruptly suspended its second round of funding procedures after founder Liang Yuanfeng's remarks on U.S.-China AI competition went viral online. The company is reportedly pausing new investment contracts while advancing its IPO preparations and focusing on long-term AI research. Bloomberg reported that DeepSeek notified some investors orally that the initial investment agreements would not be finalized for now, leaving room for potential resumption of the fundraising process. The decision is believed to have been influenced by Liang's frustration over leaked private conversations from the first funding round, where he criticized the U.S.-China AI rivalry, reliance on NVIDIA GPUs, and China's lagging AI capabilities compared to the U.S. DeepSeek has not officially commented on the leaked chats or the funding suspension. While negotiations are not entirely closed, it remains unclear if all investors received the same policy. DeepSeek recently completed its largest-ever first funding round for a Chinese AI startup, securing $7 billion from Tencent, CATL, and the National AI Industry Investment Fund. The follow-up round aimed to raise over $2 billion, potentially increasing further based on investor participation. At the time of the first funding, the company's valuation was at least $5 billion, significantly higher than its initial $50 billion valuation. DeepSeek is now accelerating its IPO preparations, with potential listing procedures starting as early as this year. The company is expected to become a landmark case for China's AI industry.