DeepSeek is a new open-source AI model developed in China that claims to be cheaper and more potent than large language models based in the US, such as ChatGPT and Google's Gemini.

The cause of investors’ panic was DeepSeek, an obscure Chinese hedge fund turned AI startup that has blown analysts away with its latest large language model, R1, released on January 20th. Consumers have flocked to DeepSeek’s chatbot,

The Chinese startup DeepSeek shocked many when its new model challenged established American AI companies despite being smaller, more efficient, and significantly cheaper. However, management theory — specifically disruption theory — could have predicted that a challenger like this would inevitably come along.