DeepSeek AI revitalizes China's venture capital landscape

DeepSeek's recent AI breakthrough is revitalizing China's venture capital scene after three years of decline. The launch of its OpenAI competitor has sparked significant interest, leading to a surge in funding for AI companies like Insilico Medicine, which recently raised $110 million. Chinese venture capital investment fell to a record low of $48.86 billion in 2024. However, emerging regulatory clarity and renewed investor interest are shifting the landscape, with many funds eager to back established AI firms rather than new startups. Beijing is signaling support for the tech sector, with plans for a fund to mobilize 1 trillion yuan for investment. This policy shift, along with a growing interest from global investors, suggests a potential recovery in China's venture capital market, particularly in AI.