How A Chinese Villager Shook Silicon Valley [DeepSeek Founder]

hi welcome to another episode of Cold Fusion this is leang Fen Wang a 40-year-old Chinese man from M Ling Village in the southern province of guandong up until a few weeks ago he was essentially unknown but now the whole world is scrambling to gather more information about him the reason deep seek an AI system that he built with some of his college buddies caused a$1 trillion stock meltdown on Wall Street and the entire Tech world has taken notice and how could they not deep seek as a product has rivaled the best of the United States

in fact when the dust settled everyone was left scratching their heads how had this guy seemingly come from nowhere to challenge a hundred billion American Giants for cheaper and is releasing it for free it changed the perceived Power Balance of the global AI race when leang returned to his hometown for Chinese New Year he received a hero's welcome David had fought Goliath China had joined the Americans in the AI race and leang Fen Wang was the guy who did it his childhood friend Leon tells the financial times quote we all grew up in the same

Village we're very proud of him so I'm sure you wondering what is the story of Liang win Fang and his company deep seek in part two of this series we'll find out a few weeks after its launch the Deep seek R1 effect continues Invidia stock is slowly climbing but it's still down Wall Street Silicon Valley Valle and much of the Tech Community are still digesting what this all means America was humiliated seemingly their restrictions on China had backfired big time the rest of the Western World had its doubts but if anyone was praying for deep

seek to be all a fluke it was Silicon Valley there were frantic attempts to make sense of who leang was a mastermind playing the system a lone wolf or a part of a larger conspiracy leang Fen Wang has been called a noble entrepreneur a nationalistic hero a government porn a mad genius the anti-s Silicon Valley CEO and everything in between why is it so hard to get information on what he calls himself well it's because he's remained silent and to those who know him this behavior is part of his Constitution as a rival fund manager

puts it quote for those who know him well he can talk a lot when it's a topic of Interest he's not being rude when he's suddenly quiet which often happens he's thinking if he doesn't want to talk to you he'll let you know leang win Fang was born in 1985 in a small village in the guong province of China his parents were both Primary School teachers he grew up in a time where China was adopting market capitalism the stable State assigned jobs of the past were gone and so leang was surrounded by people that were

trying to start their own businesses and parents who pushed their kids to excel in school and Excel he did one of his high school teachers reflects on leang saying that he stood out in the class of 50 as quote a top student especially in maths end quote in 2002 at the age of 17 he attended xang University one of China's top universities and home to Tech giants like Alibaba leang majored in electronic information engineering all of this at this point was pretty mundane but then something happened that would change his life and change the course

of history in 2007 the financial crisis hit and leang still in University was very curious about it While others were freaking out leang ran towards the crisis he pulled together a group of classmates to investigate an ambitious question could machine learning predict market trends better than human Traders they got to work and sure enough leang and his team found patterns that other Traders had missed and from then on they began experimenting with financial technology and it made him a lot of money Millions but leang ever the academic did go back to University and there receiving

his masters of Engineering in information and communication engineering his dissertation was on how to track moving objects using a cheap camera so as it turns out he's always had a longtime interest in finding cheaper ways to make powerful tools after graduating in 2010 and using his skills in maths and coding he ventured further into automated stock trading first as a freelancer and then with his college mates but he wanted more so leang branched out to start his very own hedge fund at the young age of 30 and this was in 2015 there he would do

something remarkable he used deep learning models in live trading you see using AI to predict market trends and make investment decisions was a novel idea at the time as deep neural Nets only came onto the scene about 3 years earlier with alexnet and that was just for image recognition so having the foresight to use deep learning and trading in China of all places was very notable his hedge fund grew to become one of China's quote big four quantitative analysis firms another manager of a hedge fund in China who has known leang for years recalls quote

he stands out from the crowd because he's a true engineer he thinks and acts like one while we're managing people in funds he is coding every day liang's hedge fund now called high flyer used AI to their advantage they eliminated the need for human portfolio managers and high flyer went from strength to strength managing billions and assets so at this point you could imagine everyone's shock when it's co-founder leang W Fang walked away from it all people knew that leang was interested in AI but only as a hobby so what came next was a surprise

to all in 2023 leang announced that his hedge fund high flyer would instead focus on artificial general intelligence or AGI that is human level intelligence that's aimed to mimic and outperform humans on a range of tasks not just Financial trading it was crazy talk because AGI if it exists at all likely means a foundation foundational AI model and foundational AI models were only something that Tech giants like Google open AI meta bardu and Alibaba de to touch um specifically focused on AI are there spaces where you see let's say a startup from India building you

know you can build on the models you know be it uh cha PT and many others but if you want to build foundational models how should we think about that where is it that a team from India you know three super smart Engineers with you know not 100 million but let's say 10 million could actually build something truly substantial look the way this works is we're going to tell you it's totally hopeless to compete with us on training Foundation models you shouldn't try and it's your job to like try anyway and I believe both of

those things AGI was a whole another beast on top of that way Beyond foundational models and no one had been successful at that yet and in addition the American companies were still light years ahead of leang but he wasn't scared in fact he recognized the role of hard in AI development so he started buying up thousands of Nvidia a100 GPU cards people thought he was Reckless but he continued and he'd create a special research lab for his AI hobby when former President Biden limited China's access to American gpus it should have been game over for

leang but it wasn't true to form leang once again saw this setback as an opportunity he reworked the training process to reduce the Reliance on gpus and we all know the story from here leang charged ahead spinning off his research lab into a separate company that would become deep seek his purpose was to be a research body no external financing and no plans for commercialization in the last episode we talked about how deep seek was accused of stealing IP from open Ai and the internet was quick to point out the irony after open AI scraped

the whole internet for their model but leaving that aside leang was inspired by America in some less Ed ways he describes America as China's teachers in a rare keynote on quantitative investing but from then until now leang has seemed to reject the American way of doing things as American CEOs became louder and more public leang kept a low profile where the structure of Silicon Valley companies is hierarchical deep seek is from the bottom up instead of poaching top Engineers from around the world leang would hire bookworms these guys often wouldn't have computer science degrees or

even any work experience the reason leang believed that experts were too stuck in their ways so why not get people that are just passionate in the United States exclusive access to resources plus billion dollar Investments equal Innovation but leang proved that Innovation could happen on the same scale with far fewer resources and while open AI has shifted to closed Source claiming that the move will stop AI from falling into the wrong hands deep seek is open source hoping that it will get into the right hands once that will advance the field of AI to potentially

AGI in China open source is cultural and part of a growing Trend as leang says quote for technologists being followed is rewarding open source is cultural not just commercial giving back is an honor and it attracts Talent end quot but why make it so open source couldn't us companies just take the improvements and make it for their own AI well if is to be believed leang says that it's not about the profit and is hellbent on innovation and most importantly Chinese Innovation quote for years Chinese companies have been accustomed to leveraging technological innovations develop somewhere

else and monetizing them through applications but this isn't sustainable from investors to big companies everyone in China often says there's a 1 to 2E gap between Ai and China and the us but the real Gap is the difference between imitation and originality for many years Chinese companies have mostly been used to letting others innovate and monetizing their inventions but that doesn't have to be the case our Point of Departure in this wave is not to make a quick Buck but to get to the Forefront of the technology so we can drive the development of the

entire ecosystem end quote consider this in the context of everything going on between China and the us and it makes sense why people think liang's moves is not about slowing down the us but speeding everyone up if investors are more reluctant to invest in US AI companies it levels the playing field for all but throughout all of this fuss and hoo-ha leang has remained silent he the center point of 21st century Tech War tensions between the US and China and there hasn't been a peep from the guy but leang couldn't stay silent when the Chinese

government came knocking he's been snatched up and appointed as the one and only AI leader of China and his first task a joint publicized meeting with a select group of Chinese entrepreneurs and Lee Quang who only answers to Xi Jinping himself leang has now been tasked with leading China into an era of technological breakthroughs leang has stated that he wants China to do more than just scale existing applications of Western Tech quote we believe that with economic development China must gradually transition from being a beneficiary to a contributor rather than continuing to ride on the

coattails of others over the past 30 years of the it Revolution we barely participated in core Tech Innovation end quote leang appears to believe that chasing profit kills Innovation so the question is is will he stick to his word or will he be pulled into temptation like open Ai and lastly although completely expected do those meetings with Chinese officials mean military or other Advanced AI capabilities for the CCP after all not long after the release of deep seek American companies such as Google and open AI are changing their tolerance to AI military and defense applications

they're letting in the US government as a customer of bespoke Technologies so this is all moving very fast but one thing is for sure is definitely going to be interesting boys and girls so let's all sit back and watch the show unfold as F Yang maybe he'll speak to the Press about deep seek one day but let's not hold our breath so that is the story of how a villager from China shocked the world and upset Silicon Valley so what are your thoughts on this feel free to let me know in the comment section below

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