DeepSeek Reportedly Seeking $200 Million in Funding… While Huanfang Earned $5 Billion in a Year?
DeepSeek is reportedly planning its first round of funding, aiming for a valuation exceeding $10 billion (approximately 68.1 billion yuan) and seeking to raise at least $300 million (approximately 2 billion yuan). However, questions arise as to whether they actually need the funds, given Huanfang's substantial earnings.
DeepSeek’s parent company, Huanfang Quant, achieved an approximate return rate of 56.6% in 2025.
Roughly calculated based on a “1% management fee + 20% performance reward,” Huanfang’s management fee plus performance reward income is estimated at around “5 billion yuan / $700 million” for 2025 alone.
Liang Wenfeng has publicly stated that DeepSeek does not lack funds, possesses self-hematopoietic ability, and has no plans for financing in the short term.
DeepSeek has also previously rejected investment offers from numerous investment institutions and major companies.
Furthermore, there have been several rumors of DeepSeek financing in recent years, all of which were later officially denied and debunked.
Will this news be another false alarm?
Is this funding rumor credible?
Let’s first look at the news itself. The source is The Information, one of the most reliable media outlets for exclusive scoops in the US tech circle.
The report, citing “multiple sources familiar with the matter,” claims that DeepSeek is seeking its first external funding, planning to raise at least $300 million (approximately 2 billion yuan) with a target valuation exceeding $10 billion.
Subsequently, the report was reprinted by multiple organizations, including Reuters, making it seem more credible.
However, those familiar with DeepSeek might say: Wait, didn’t they deny this several times before?
DeepSeek financing rumors first emerged as early as February 2025, with reports that Alibaba and other tech giants had expressed investment interest. DeepSeek explicitly responded that the financing news was “rumors.”
At that time, the DeepSeek-R1 model had just gone viral globally, and the company was at the center of unprecedented public attention.
Liang Wenfeng’s public statements at the time showed a clear reluctance to financing, with core concerns being that “external investors would interfere with company decisions” and that “many VCs are hesitant to invest in research, as they have exit requirements and hope to quickly commercialize products.”
By August 2025, rumors of DeepSeek financing resurfaced, this time more specific, with an amount of “$700 million” and a “C round of financing,” as well as a valuation of “$8 billion.”
However, this rumor was quickly debunked, and it was found that the source of the information was unknown and the report was deleted.
As of this writing, DeepSeek has not yet responded to this latest rumor in April 2026.
If DeepSeek were to seek financing, what would be the reason?
How profitable is Huanfang? In 2025, the average product return rate was approximately 56.6%, ranking second among quantitative private equity funds with assets exceeding 10 billion yuan.
At the same time, the average for quantitative funds of similar scale was only 37.61%, with Huanfang outperforming its peers by nearly 20 percentage points.
If DeepSeek doesn’t lack funds, what could be the reason for seeking financing if the rumors are true?
The most noteworthy financial impact lies in anchoring equity value.
Under the “self-blood transfusion” model, DeepSeek, as a wholly-owned or controlling subsidiary of Huanfang Quant, has not had its value priced by the market. In Huanfang Quant’s financial statements, it may only be measured using the cost method or net asset method, failing to reflect its true commercial value.
External financing with a valuation of $10 billion is equivalent to providing a market-based pricing benchmark for DeepSeek’s equity.
From this perspective, a large valuation coupled with low financing makes sense.
It both obtains external valuation and maximizes retention of decision-making power.
Having equity value allows for better incentives for talent.
DeepSeek’s absolute salary is not low, but recently core researchers such as Guo Daya, Wang Bingxuan, and Wei Haoran have reportedly received higher compensation after jumping ship.
Faced with increasing talent competition pressure, DeepSeek may also want to anchor its valuation to give its employees peace of mind.
There is also one point that is often overlooked: high-quality investors bring not only money, but also computing power collaboration, customer channels, and political connections. These “non-financial values” are completely lacking in the “self-blood transfusion” model.
Quantum Bit has learned that DeepSeek’s financing and valuation may only be the tip of the iceberg. It is reported that Liang Wenfeng personally put in 20 billion yuan in the first round of financing, both as a reassurance to external investors and as a declaration of his personal belief.
One More Thing
Now is a time of warming AI industry financing.
After the adjustment period in 2024, the global AI investment market showed a recovery trend from the second half of 2025 to early 2026, with an increase in large-scale financing cases and a rebound in valuation levels.
Liang Wenfeng, as a deep participant in the financial industry, naturally saw this trend and is likely to take advantage of it.