DeepSeek wants to raise twice as much capital without raising its valuation

DeepSeek's second funding round has grown significantly. The original target was 50 billion yuan, but according to Chinese media it is now around 100 billion yuan, or roughly $14 billion, according to the Korean outlet Seoul Economic Daily. The target was doubled within two weeks, according to the source.

The round has not been formally closed, and DeepSeek has not itself confirmed the information in the texts reviewed. All three sources rely on reporting from other outlets, including Bloomberg and the Chinese outlet Caijing.

Same valuation, more capital

The pre-money valuation is roughly 500 billion yuan, according to The Standard in Hong Kong. It is thus unchanged even though the round is getting bigger. In other words, investors are not getting a more expensive entry point, even though more money is coming in.

The first round raised more than 50 billion yuan at a valuation above 350 billion yuan. It started in April and closed at the end of June 2026. In total, that comes to roughly 150 billion yuan in six months.

Who is investing?

Tencent and battery giant CATL are described in one of the sources as joint leaders of the round. CATL reportedly invested about 5 billion yuan in the first round and plans another 10 billion yuan in the second. Founder Liang Wenfeng reportedly contributed 20 billion yuan in the first round.

New investors in the second round are said to include Stony Creek Capital, China Fortune-Tech Capital, CPE, Legend Capital and Geely. The Korean source instead names GigaDevice and SMIC as new investors, so the sources do not fully agree here. Existing investors named include IDG Capital, Lux Capital and Silicon 100.

The stock market awaits

After the round, DeepSeek is reportedly set to complete a restructuring of the company and prepare an IPO on Shanghai's STAR Market. CITIC Securities is named as an adviser. According to Caijing, an application is expected to be filed as early as the end of 2026, with a listing in 2027. These are plans, not something that has happened. In September 2026, DeepSeek hired a former Hillhouse partner as its first chief financial officer.

Revenue and use of the funds

According to Caijing, citing The Information, annualized revenue is above $1 billion, up from $500 million. Annualized means that current revenue has been converted to a full year. According to Caijing, the gross margin on the company's API sales (access for other companies to use the models) was 82.9 percent in January-July, while the overall gross margin was 44.6 percent. Prices were raised to 2-4 times their previous level in August.

According to the Korean source, the money is to be used for a data center in Inner Mongolia and for more than 160,000 Huawei Ascend AI chips.