DeepSeek pauses second fundraising round after viral comments on US-China AI competition

DeepSeek, the Chinese AI lab that closed a record $7 billion first round in June, has suspended its second fundraising round as of July 25, Bloomberg reported. Founder Liang Wenfeng verbally informed prospective investors that investment agreements would not be signed in the coming days. The pause stemmed partly from Liang's frustration over viral social-media posts reporting comments he allegedly made during the June round about China's AI lag relative to the U.S. and reliance on Nvidia chips for development. Bloomberg could not independently verify those posts, which circulated on Chinese media including Yicai.

DeepSeek had been seeking at least 10 billion yuan (~$1.4-1.5 billion) in a follow-on round at a pre-money valuation of roughly 480 billion yuan (~$71 billion). The company previously raised from Tencent, CATL, and the state-backed National AI Industry Investment Fund. The halt came just weeks after the June close and suggests either operational recalibration or discomfort with capital-markets attention. Negotiations remain fluid; DeepSeek may resume later, and the company has not officially commented on the transcript or fundraising pause.

For the AI infrastructure stack, the pause signals that even billion-dollar lab architectures can face organizational friction around capital markets and IP strategy. DeepSeek remains one of the few Chinese labs to prove high-performance open-weight models with 10% of Western compute spend—a result that spooked Washington and prompted distillation-theft accusations against other Chinese labs. The company is also preparing for an IPO potentially as soon as 2026, per Bloomberg. Watch for official clarity on the pause and any restructuring announcements as the company stabilizes its capital roadmap.