#funding

OpenAI has secured about $11 billion in its latest funding round, less than half of the $30 billion it first sought, The Wall Street Journal reported, citing people familiar with the matter; interest from some large investors was "tepid." The Financial Times reported that the company cut the target by $10 billion to about $20 billion, and CNBC confirmed the new target, citing a person who said the round is still open and the figures could change. The Next Web summarizes all three.

The round values OpenAI at $1.25 trillion after the new money, down from the $1.4 trillion it first pitched, the FT reported. OpenAI told shareholders it expects to raise more in the coming weeks, including from family offices and wealthy individuals, per the WSJ. The FT says UAE investors, including state-backed MGX, are likely to be the largest backers, with SoftBank, Founders Fund, Coatue, Sequoia and Andreessen Horowitz also planning to invest. OpenAI plans to list as soon as early next year.

The Department of Homeland Security published an order in the Federal Register on October 20 that excludes products and services from Hangzhou DeepSeek Artificial Intelligence Co. and its affiliates from federal civilian procurement, and requires agencies to remove DeepSeek products, including third-party products built on DeepSeek technology, from their IT systems. It was issued under the Federal Acquisition Supply Chain Security Act of 2018. Agencies can request exceptions within 60 days, which CISA will review. BleepingComputer notes it is not a ban on private or consumer use.

According to the reports, DHS cited concerns about possible Chinese government access to data and transfer of sensitive government information, and pointed to earlier research finding security flaws in DeepSeek's iOS app. China's Foreign Ministry said Beijing opposes "overstretching the concept of national security."

Two days later, Bloomberg reported (via TechCrunch) that DeepSeek raised about $15 billion (roughly 100 billion yuan), with CATL and Tencent among potential investors.

Butterfly Effect, the company behind AI agent startup Manus, raised more than $500 million in a round co-led by Boyu Capital and IDG Capital, with Tencent, HSG and ZhenFund joining, Pulse 2 reports, citing Reuters. Meta had agreed to buy Manus for more than $2 billion; Chinese authorities ordered the deal unwound in April, and Manus said in August it would operate independently again and delete some user data. Its annualized revenue reportedly reached about $500 million by June, and a Hong Kong IPO is not expected before 2027.