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DeepSeek isn’t taking VC money yet. Here’s 3 reasons why.
As the world continues to be captivated by the rapid advancements in AI technology, a recent report from The Wall Street Journal has shed light on DeepSeek, one of the most promising AI startups globally, and its decision to forego venture capital funding. According to sources close to the matter, DeepSeek’s founder Liang Wenfeng is not eager to invite outside investors into his company, citing three compelling reasons for this stance.
Firstly, control is a significant concern for Liang. With a staggering 84% ownership stake in the company, he is determined to maintain a tight grip on his project. In an earlier interview with Chinese media, Liang expressed frustration with venture capitalists’ propensity to push AI companies towards rapid monetization over fundamental research. Given this history, it’s clear that he would rather not compromise his vision by inviting external investors.
Secondly, DeepSeek is facing challenges in accessing essential AI chips due to U.S. export controls. These chips are crucial for the development of Liang’s project and are heavily restricted in China. The company’s ability to remain self-funding may also be waning, as its flagship funds have underperformed since 2022 and face ongoing scrutiny from the Chinese government.
Lastly, while interest from prominent players such as Tencent and Alibaba has been reported, it’s likely that DeepSeek is holding out for a more favorable arrangement. With its recent announcement of a theoretical profit margin, signaling a shift towards monetization, Liang may be more willing to entertain investment opportunities in the future.
It remains to be seen if this stance will remain unchanged or if these factors will prompt a change in strategy. One thing is certain – the AI landscape continues to evolve at breakneck speed, and DeepSeek’s decision reflects the shifting dynamics within the industry.
Source: https://techcrunch.com/2025/03/10/deepseek-isnt-taking-vc-money-yet-heres-3-reasons-why/
