DeepSeek's outside funding draws interest from Alibaba, Chinese state funds, The Information reports

Chinese AI startup DeepSeek is considering outside funding for the first time and has drawn interest from Alibaba (9988) and state funds, The Information reported on Wednesday, citing sources with knowledge of internal discussions.

The Chinese company stunned the tech industry earlier this year with low-cost AI models that can match or even outperform Western rivals at a fraction of the cost, stirring doubts about the lead United States has in the race to dominate the technology.

Executives at the Chinese AI firm and its hedge fund parent, High-Flyer Capital Management, are also talking about whether DeepSeek should shift its focus to building a business that generates revenue and eventually profit from research, the report said.

REUTERS