My Take | DeepSeek’s success shows China’s strength is in its private entrepreneurs

Only three years ago, DeepSeek’s founder and its team of tech wizards were seemingly on the wrong side of the Chinese government

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Screens displaying the logos of DeepSeek and OpenAI’s ChatGPT are shown in this arranged illustration taken on January 29, 2025. Photo: AFP

Published: 7:00am, 4 Feb 2025

DeepSeek, the Chinese start-up that has become a hot topic among investors and politicians over the past week, made history by shattering the conventional wisdom that the United States’ lead in artificial intelligence (AI) development is difficult to match or even surpass.

Hangzhou-based DeepSeek has generated so much pride in China that one tech executive said the firm’s breakthrough in building AI models cost-efficiently provides leverage to change China’s national fate. Founder and chief executive Liang Wenfeng even received a hero’s welcome in his hometown during his Lunar New Year visit last week.

But only three years ago, DeepSeek’s founder and its team of computing geeks were seemingly on the wrong side of the Chinese government’s preferred development activities.

Liang’s hedge fund, High-Flyer Quant, uses sophisticated AI algorithms to trade stocks, which was previously viewed by some as morally questionable because it amplified stock market volatility and put retail investors in a disadvantaged position.

The icon for the DeepSeek app is seen on a smartphone screen in Beijing, January 28, 2025. Photo: AP

The firm had struggled to sustain double-digit investment returns once its scale hit 100 billion yuan (US$14 billion) amid the overall weakness in China’s stock market.