DeepSeek, a rapidly emerging Chinese artificial intelligence startup, has captured significant attention in the tech world.
Liang Wenfeng, a hedge fund manager specializing in AI-driven investment strategies, founded the company in July 2023. DeepSeek now competes with established players like OpenAI and Meta.
Overview of DeepSeek
- Foundation and Leadership: Liang Wenfeng, who also manages the hedge fund High-Flyer, established DeepSeek in Hangzhou, China. The company aims to develop open-source large language models (LLMs) that rival major Western firms.
- Technological Innovation: DeepSeek recently launched DeepSeek-R1, an AI model that uses “inference-time computing.” This approach activates only the most relevant model portions for each query, improving computational efficiency and reducing costs. The company developed DeepSeek-R1 at a remarkably low cost of $5 to $6 million, far less than the billions spent by competitors like OpenAI.
- Market Impact: DeepSeek-R1 debuted on January 10, 2025, and quickly became the top free app on Apple’s App Store in the U.S. This rapid success led to significant market reactions, including a sharp drop in Nvidia’s stock price due to concerns about its dominance in AI hardware facing new competition.
Key Features
- Open Source: DeepSeek provides open-source models, allowing developers worldwide to access and modify the code. This transparency fosters innovation and lowers entry barriers in the AI market.
- Performance Comparison: Experts note that DeepSeek’s models outperform leading U.S. AI systems like ChatGPT despite using less sophisticated hardware. Venture capitalist Marc Andreessen described DeepSeek’s rise as “AI’s Sputnik moment,” emphasizing its potential to disrupt the industry.
Challenges and Skepticism
Despite DeepSeek’s impressive achievements, some analysts question its long-term viability in the U.S. market. Geopolitical tensions and trust issues surrounding Chinese technology in critical AI infrastructure pose significant challenges.
DeepSeek marks a pivotal shift in the global AI landscape, challenging industry norms and prompting a reassessment of the U.S. and China’s technological dominance.
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Owais Qarni is a Co-Founder, Chief Editor, and Author of Saudi Scoop. He is passionate about tech, cars, and traveling. A Dreamer, Explorer & Optimist!
