April 22 (Reuters) - Chinese tech giants Tencent Holdings (0700.HK) and Alibaba Group (9988.HK) are in discussions to invest in artificial intelligence startup DeepSeek, The Information reported on Wednesday, citing four people with knowledge of the conversations.
DeepSeek, owned by Chinese hedge fund High-Flyer Capital Management, is seeking to raise funding at a valuation of more than $20 billion, after its initial discussions with prospective investors generated immense interest, the report said, citing one of the people.
Alibaba, Tencent and DeepSeek did not immediately respond to requests for comment. Reuters could not independently verify the report.
The Information reported on Friday that DeepSeek started talks to raise outside capital for the first time, targeting to raise at least $300 million at a valuation of at least $10 billion.
The potential fundraise underscores the intense capital requirements for developing and running top-of-the line AI models amid ​the rise of advanced reasoning and agentic ​bots.
The talks are still underway and both the valuation and the amount of capital to be raised could still change, according to the report.

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- Chinese tech giants Tencent and Alibaba are in discussions to invest in AI startup DeepSeek, which is seeking over $20 billion in funding.  
- DeepSeek, backed by High-Flyer Capital Management, aims to raise at least $300 million as it initiates talks for outside capital for the first time.  
- These discussions highlight the significant capital needed to develop advanced AI models as the industry evolves, with the potential terms still subject to change.

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Tencent, Alibaba in talks to invest in DeepSeek at over $20 billion valuation, The Information reports