[Digital Today AI Reporter] DeepSeek is seeking outside investment for the first time this year, sharpening the division of roles between its founder Liang Wenfeng (량원펑) and his quant hedge fund High-Flyer, and DeepSeek.

On Aug. 28 (local time), CNBC reported that High-Flyer-affiliated funds secured pre-IPO allocations in Chinese semiconductor and robotics companies, while DeepSeek moved to raise separate financing to meet expanded funding and computing demand.

DeepSeek is a research lab that drew attention in China’s artificial intelligence industry in January. Early on, High-Flyer provided funding and computing resources. As DeepSeek has grown, analysis has emerged that the existing structure has limits. Siel Chi (시엘 치), an analyst at Rhodium Group, said High-Flyer’s profits have become unstable and DeepSeek may find it difficult to rely only on High-Flyer.

Zhejiang High-Flyer Asset Management and Ningbo High-Flyer Quant Investment Management received private placements in Changxin Memory Technologies (CXMT), Unitree Robotics and companies in semiconductor packaging, electronic components and renewable energy. The largest allocation among them was CXMT. The pre-IPO shares secured by the two funds totalled 175 million yuan, or about 36 billion won. CXMT shares surged more than fivefold on their first day of trading after listing on the Shanghai stock market in July, and were up about another 20 percent as of Aug. 28.

DeepSeek also invested directly in Unitree Robotics. The two funds were allocated shares worth a total of $5.8 million, or about 8 billion won. DeepSeek, one of nine strategic investors, secured 2.31 percent of the offering allocation and agreed to a 36-month lock-up, longer than the 12 months applied to most strategic investors. Unitree Robotics surged 460 percent on its first day of trading on the Shanghai stock market last week and then fell about 27 percent.

High-Flyer’s investments were also affected by market volatility. In July, 8 of High-Flyer’s 9 products posted losses due to a sharp fall in global AI semiconductor stocks. In August, returns for Chinese quant funds rebounded.

DeepSeek is seeking external funding for the first time this year. Sigrid Wang (시그리드 왕) of Hutong Research said DeepSeek has grown too large to remain a side project of High-Flyer and has become a capital-intensive business. DeepSeek’s first fundraising size of 50 billion yuan, or about 1.02 trillion won, exceeds 60 percent of High-Flyer’s assets under management of 80 billion yuan, or about 1.63 trillion won.

DeepSeek is pushing a second investment round to raise at least $7.4 billion more, or about 1.02 trillion won. It also temporarily halted fundraising after remarks from a July investor meeting were leaked.