How China’s DeepSeek outsmarted America

Author

Noel Moldvai
January 30, 2025

TL;DR. Sometimes, we have to pinch ourselves and realize that we are actually living in reality, with all these seemingly 'out of the ordinary' headlines emerging on a regular basis! DeepSeek sends shockwaves through the markets, while OpenAI now claims to have proof that the Chinese upstart did, in fact, use OpenAI’s model to train DeepSeek—all while Boom is busy surpassing Mach 1 over the Mojave. What a time to be alive.

How China’s DeepSeek outsmarted America

DeepSeek, led by Liang Wenfeng, leveraged young engineers, programming shortcuts, and a loophole in U.S. chip restrictions to develop advanced AI models. By optimizing data processing and using Nvidia’s H800 chips before stricter controls, DeepSeek shocked Wall Street, triggering a $1 trillion market shift and forcing U.S. policymakers to reassess AI regulations.

Perplexity AI proposes to merge with Tiktok, with US government getting half, source says

Perplexity AI revised its merger proposal to ByteDance, suggesting a new U.S. holding company, "NewCo," combining TikTok U.S. and Perplexity. The plan includes ByteDance selling TikTok U.S. while retaining its recommendation algorithm, with the U.S. government owning up to 50% after an IPO valued at $300 billion.

DeepSeek hit with large-scale cyberattack, says it’s limiting registrations

DeepSeek temporarily limited new user registrations after large-scale cyberattacks, though existing users remain unaffected. The Chinese AI startup recently surpassed OpenAI's ChatGPT as the top free app on Apple’s App Store, fueling market sell-offs. Its open-source R1 model, built at a fraction of competitors’ costs, is reshaping AI industry economics.

Boom Supersonic XB-1 breaks sound barrier over Mojave Desert

Boom Supersonic’s XB-1 became the first privately funded plane to break the sound barrier, reaching Mach 1.1 over the Mojave Desert. The test supports Boom’s goal of developing Overture, a supersonic airliner carrying 64-80 passengers. With 130 orders, Boom plans to produce 66 aircraft annually at its North Carolina facility.

Why start ups are staying private longer

Startups are staying private longer due to the abundance of capital in private markets, enabling them to maintain control and focus on long-term growth. This trend has fueled a surge in private secondary market activity, attracting interest from private equity and retail investors alike. It has also highlighted the need to update outdated regulations, improve market efficiencies, and support investors looking to diversify into private markets.

Quick Takes

Cheerio! Until next week.
-Noel