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DeepSeek seeks outside capital as High-Flyer faces AI investment costs
A High-Flyer affiliate pair secured about RMB175m, or $26m, in pre-IPO shares of CXMT before its Shanghai debut in July, when the stock surged more than fivefold.
DeepSeek, the Chinese AI lab backed by hedge fund founder Liang Wenfeng, is seeking additional outside capital to support its artificial intelligence ambitions, CNBC reported through Hedgeweek. The report said the move increases pressure on Liang’s flagship investment vehicle, which has also been supporting DeepSeek as AI development becomes more expensive.
According to the report, DeepSeek initially relied on funding and computing resources from Liang’s quantitative investment firm, High-Flyer Quant, which spent years applying machine learning and deep-learning techniques to financial markets. As DeepSeek expands, it has turned more to external investors while High-Flyer and related entities have built positions in high-profile China technology IPOs, including semiconductor and robotics names.
The pre-listing strategy has offered upside from potential pre-IPO allocations, but the report also links the approach to heightened exposure to China’s tech market swings. Data compiled by PaiPaiWang, as cited by Hedgeweek, showed Zhejiang High-Flyer Asset Management and Ningbo High-Flyer Quantitative Investment Management received about RMB175m, or $26m, of shares in CXMT before its Shanghai listing, with CXMT shares surging more than fivefold on the July debut.
The report also highlighted volatility around other IPO bets, including Unitree Robotics, where the two High-Flyer vehicles received about $5.8m of shares pre-listing. Unitree shares initially jumped around 460% on their debut before retreating about 27%, and the report said eight of High-Flyer’s nine products reportedly posted losses in July as a global AI-driven selloff weighed on performance.
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