DeepSeek, the Chinese artificial intelligence startup that disrupted Silicon Valley last year, has taken a concrete step toward going public by engaging CITIC Securities to prepare for a potential initial public offering on Shanghai's STAR Market, according to a report by Channel Insider. The Hangzhou-based company plans to start the IPO process this year, though it hasn't determined how much capital it will raise, when the offering will occur, or what valuation it will target. The appointment of a securities firm to conduct pre-listing tutoring—standard practice before submitting a mainland Chinese listing application—signals that DeepSeek's public-market plans have advanced beyond preliminary talks.
The push for an IPO comes as DeepSeek pursues significant funding to cover computing infrastructure, model development, and researcher recruitment and retention. The company sought a funding round in July that could have valued it at roughly 500 billion yuan, or about $75 billion. Before that, DeepSeek raised approximately $7.4 billion in June at a post-money valuation above $50 billion, with founder Liang Wenfeng contributing 20 billion yuan to that round while Tencent invested 10 billion yuan and CATL put in 5 billion yuan. The company also increased API prices for its V4-Flash and V4-Pro models in August, with rates climbing from about 57% to more than 1,100% depending on the model, token type, and billing period.
The report notes that the funding pressure reflects the economics of building frontier AI systems, where more users demand more computing capacity and competition for engineers pushes companies to offer stronger pay packages. DeepSeek has been losing talent to better-funded competitors, including ByteDance and Xiaomi. The company wouldn't be the first Chinese AI model developer to seek public-market funding—Z.AI and MiniMax listed in Hong Kong earlier this year, while Moonshot AI has confidentially filed for a Hong Kong IPO. The valuations under discussion also reveal a substantial gap with leading U.S. AI companies, as investors have suggested Anthropic could reach a valuation of up to $2 trillion in an IPO while OpenAI could seek as much as $1 trillion.
An IPO could give DeepSeek a more stable source of capital as AI development becomes progressively more expensive, and it could provide another tool to compete for scarce technical talent without depending exclusively on private funding rounds. But going public would create its own pressures, since a high valuation would establish expectations for growth and financial performance at a company still spending heavily on infrastructure and research. The report finds that DeepSeek's ability to convert its technical reputation and growing market presence into sustainable revenue will become increasingly important to investors. For channel partners and enterprise customers, the IPO process could offer greater visibility into whether DeepSeek can maintain its low-cost positioning while funding the infrastructure and talent needed to compete. The tension between technical ambition and financial sustainability may ultimately define whether public markets reward or punish the company's approach. Investors will be watching closely to see if the model that rattled established players can build a business that justifies the valuations now being discussed.