Notes on DeepSeek

DeepSeek was founded in 2023 out of the High-Flyer hedge fund, and recently proved its capabilities with the release of the R1 model. Located in an unremarkable building in Hangzhou, the company operates with a small team of about 300 people, and tends to focus on technical polish rather than scaling headcount.

The competitive landscape and characteristics of AI within China are as follows:

• Major competitors: Alibaba (Qwen), ByteDance, and Moonshot (Kimi) are competing fiercely.
• User behavior: Within China, Kimi and DeepSeek see high usage share, and younger users sometimes use Claude via VPN.
• Talent drain: As in the US, competition among companies to poach talent is very active.

Regulatory and social perspectives:

• Regulatory approach: Rather than directly regulating the models themselves, oversight is managed through restrictions on how software and services are used.
• Social perception: Within China, AI is discussed less in terms of philosophical topics like the singularity, and more in terms of practical social issues such as job losses and the perspective of infrastructure building.
• Technical orientation: The DeepSeek team keeps up with technical trends by consuming content from Western AI writers (Dwarkesh, Gwern, etc.).