How DeepSeek could ultimately boost rather than batter Nvidia
Local fund managers Munro Partners and Loftus Peak, as well as startups backed by Blackbird, Y Combinator and Peak XV, believe cheaper AI models may help the chipmaker.
Nvidia's stock has been volatile after AI efficiency advances out of China indicated demand for its high-end chips could diminish. But some Australian investors and founders argue that innovations like those from AI lab DeepSeek will ultimately drive more GPU sales — not fewer.
“What’s perplexed me is the idea that this somehow makes the AI chip makers less valuable because you can do something useful with fewer chips,” said Ben Sand, whose Y Combinator-backed startup, Strong Compute, helps companies develop AI more efficiently.
"The idea that it dramatically changes the universe to the degree that people are saying is quite overblown."
DeepSeek shocked both Silicon Valley and Wall Street when it published a scientific paper detailing the breakthroughs behind its latest foundation model, DeepSeek V3. The AI lab said it trained the model — seemingly comparable to OpenAI’s best — using just 2,000 of Nvidia’s lower-tier H800 GPUs.
