DeepSeek resumes $8B funding round at $74B valuation

Chinese artificial intelligence startup DeepSeek has revived its second external funding round, seeking close to $8 billion at a valuation of approximately 500 billion yuan ($74 billion), with Hong Kong-based Monolith Management in talks to participate, Bloomberg News reported on Wednesday.reuters+1

The Hangzhou-based company had paused the process last month after frustration over leaked remarks from founder and CEO Liang Wenfeng to investors. The resumption marks a rapid valuation increase from DeepSeek's maiden financing round in June, which raised roughly 50 billion yuan and was backed by China's National AI Industry Investment Fund, Tencent, CATL Contemporary Amperex Technology Co., Limited, NetEase ↗ 1.76%, and JD.com ↗ 0.83%.bloomberg+2

Data Center Ambitions Drive Capital Needs

The proceeds are expected to fund an expansion of AI infrastructure, including a large-scale data center in Inner Mongolia aimed at securing 1 gigawatt of computing capacity. The capital-intensive buildout underscores a broader shift in China's AI sector, where competition is moving from model benchmarks toward securing raw computing power.biz.chosun

DeepSeek faces constraints in procuring advanced chips due to U.S. export controls that limit Chinese access to Nvidia's ↘ 0.10% most advanced processors. The company is also reportedly developing its own inference chip as part of China's push for domestic alternatives.finance.yahoo

Price Hikes Signal Pivot Toward Profitability

The funding revival coincides with DeepSeek's announcement that it will raise API prices across its platform. The company said the increase would be "substantial," though it did not disclose exact figures. Under the current V4-Flash model, DeepSeek charges $0.14 per million input tokens and $0.28 per million output tokens — far below competitors such as Anthropic and Moonshot.citynewsservice+1

The price move follows a surge in demand after last month's V4-Flash model release, which pushed daily throughput into the trillions of tokens. Developer platform OpenCode reported that the model processed 8 trillion tokens in a single day on August 1.citynewsservice

IPO Preparations Advance

DeepSeek is also preparing for a potential initial public offering on Shanghai's STAR Market, with earlier Reuters reporting indicating the fundraise was designed in part to position the company ahead of a mainland listing. Bloomberg noted that DeepSeek faces "three challenges at once: investor expectations, rapid market expansion, and building computing infrastructure that requires massive capital."reuters+2