Tencent, Alibaba Eye DeepSeek As Valuation Hits $20B - Alibaba Gr Hldgs (NYSE:BABA), Alibaba Gr Hldgs (OT).

Tencent, Alibaba Circle DeepSeek As AI Startup Eyes $20B Valuation That's a sharp jump from earlier discussions that pegged the raise at around $10 billion -- suggesting investor demand is accelerating quickly, the Information reported. A New AI Contender Emerges DeepSeek isn't a typical startup. The company is backed by High-Flyer Capital Management, marking a rare crossover where quantitative finance meets large-scale AI development. DeepSeek has gained attention for building competitive AI models at dramatically lower cost than Western rivals, with some estimates suggesting its systems can run at a fraction of the expense. That cost angle may be key. Why Big Tech Is Circling For Tencent and Alibaba, the interest goes beyond financial returns. Both companies are racing to strengthen their AI ecosystems amid intensifying competition -- domestically and globally. Backing DeepSeek could offer: Access to emerging model capabilities A faster route to scaling AI offerings A hedge against falling behind in the next phase of the AI cycle Valuation Momentum Builds The rapid shift in valuation expectations -- from $10 billion to $20 billion-plus -- signals more than just hype. It points to a broader trend: AI capital is still chasing the next breakthrough, especially in markets where cost efficiency and scalability could reshape the competitive landscape. The Bigger Picture This isn't just another funding round. If talks progress, it would mark a moment where China's established tech giants align with a newer AI player -- potentially accelerating the country's push to stay competitive in the global AI race. And for DeepSeek, the message is clear: the spotlight is only getting brighter. Image via Shutterstock Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.