If you’ve ever struggled with a tough math problem, you know how useful it is to think a little longer and work through it carefully. OpenAI’s o1 model showed that when LLMs are trained to do the same—by using more compute during inference—they get significantly better at solving reasoning tasks like mathematics, coding, and logic.
However, the recipe behind OpenAI’s reasoning models has been a well kept secret. That is, until last week, when DeepSeek released their DeepSeek-R1 model and promptly broke the internet (and the stock market!).
Besides performing as well or better than o1, the DeepSeek-R1 release was accompanied by a detailed tech report that outlined the key steps of their training recipe. … [This] prompted us to launch the Open-R1 project, an initiative to systematically reconstruct DeepSeek-R1’s data and training pipeline, validate its claims, and push the boundaries of open reasoning models. By building Open-R1, we aim to provide transparency on how reinforcement learning can enhance reasoning, share reproducible insights with the open-source community, and create a foundation for future models to leverage these techniques. — Read More
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DeepSeek FAQ
It’s Monday, January 27. Why haven’t you written about DeepSeek yet?
I did! I wrote about R1 last Tuesday.
I totally forgot about that.
I take responsibility. I stand by the post, including the two biggest takeaways that I highlighted (emergent chain-of-thought via pure reinforcement learning, and the power of distillation), and I mentioned the low cost (which I expanded on in Sharp Tech) and chip ban implications, but those observations were too localized to the current state of the art in AI. What I totally failed to anticipate were the broader implications this news would have to the overall meta-discussion, particularly in terms of the U.S. and China. — Read More
It’s time to come to grips with AI
We live in interesting times. On Monday morning, tech stocks plunged on investor shock and awe over DeepSeek, a Chinese AI company that has built — I’m leaving out a lot of details — an open-source large language model (LLM) that performs competitively with name brands like ChatGPT at a fraction of the computing cost.
Meanwhile, two stories got buried in the avalanche of activity by President Trump last week. Trump rescinded a Biden executive order on AI safety. And he announced Stargate, a nine-figure AI joint venture aimed at entrenching American AI competitiveness, which has triggered a feud between Elon Musk and Sam Altman, the frenemy cofounders of OpenAI.
These stories will have far bigger geopolitical implications than, say, Musk’s choice of hand gestures. They may even mark an inflection point where the world has decided to charge forward with AI at full speed, for better or worse. — Read More
NVIDIA Senior Research Manager Jim Fan Praises DeepSeek R1
NVIDIA Senior Research Manager Jim Fan recently shared his in-depth evaluation of DeepSeek R1 on social media. As the co-founder of GEAR Lab, lead of Project GR00T, Stanford Ph.D., and OpenAI’s first intern, Fan’s perspectives carry significant weight in the industry. He particularly emphasized DeepSeek’s outstanding contributions to AI open-source development as a non-US company.
In his commentary, Fan noted: “We are living in a timeline where a non-US company is keeping the original mission of OpenAI alive – truly open, frontier research that empowers all. It makes no sense. The most entertaining outcome is the most likely.” He particularly appreciated that DeepSeek not only open-sources a barrage of models but also spills all the training secrets. — Read More
The Short Case for Nvidia Stock
… [W]henever I meet with and chat with my friends and ex colleagues from the hedge fund world, the conversation quickly turns to Nvidia. It’s not every day that a company goes from relative obscurity to being worth more than the combined stock markets of England, France, or Germany! And naturally, these friends want to know my thoughts on the subject. Because I am such a dyed-in-the-wool believer in the long term transformative impact of this technology— I truly believe it’s going to radically change nearly every aspect of our economy and society in the next 5-10 years, with basically no historical precedent— it has been hard for me to make the argument that Nvidia’s momentum is going to slow down or stop anytime soon.
But even though I’ve thought the valuation was just too rich for my blood for the past year or so, a confluence of recent developments has caused me to flip a bit to my usual instinct, which is to be a bit more contrarian in outlook and to question the consensus when it seems to be more than priced in. The saying “what the wise man believes in the beginning, the fool believes in the end” became famous for a good reason. — Read More
How a top Chinese AI model overcame US sanctions
The AI community is abuzz over DeepSeek R1, a new open-source reasoning model.
The model was developed by the Chinese AI startup DeepSeek, which claims that R1 matches or even surpasses OpenAI’s ChatGPT o1 on multiple key benchmarks but operates at a fraction of the cost.
… DeepSeek’s success is even more remarkable given the constraints facing Chinese AI companies in the form of increasing US export controls on cutting-edge chips. But early evidence shows that these measures are not working as intended. Rather than weakening China’s AI capabilities, the sanctions appear to be driving startups like DeepSeek to innovate in ways that prioritize efficiency, resource-pooling, and collaboration. — Read More
DeepSeek R1’s bold bet on reinforcement learning: How it outpaced OpenAI at 3% of the cost
DeepSeek R1’s Monday release has sent shockwaves through the AI community, disrupting assumptions about what’s required to achieve cutting-edge AI performance. Matching OpenAI’s o1 at just 3%-5% of the cost, this open-source model has not only captivated developers but also challenges enterprises to rethink their AI strategies.
The model has rocketed to the top-trending model being downloaded on HuggingFace (109,000 times, as of this writing) – as developers rush to try it out and seek to understand what it means for their AI development. Users are commenting that DeepSeek’s accompanying search feature (which you can find at DeepSeek’s site) is now superior to competitors like OpenAI and Perplexity, and is only rivaled by Google’s Gemini Deep Research.
The implications for enterprise AI strategies are profound: With reduced costs and open access, enterprises now have an alternative to costly proprietary models like OpenAI’s. DeepSeek’s release could democratize access to cutting-edge AI capabilities, enabling smaller organizations to compete effectively in the AI arms race. — Read More
How China’s New AI Model DeepSeek Is Threatening U.S. Dominance
OpenAI launches Operator, an AI agent that performs tasks autonomously
OpenAI CEO Sam Altman kicked off this year by saying in a blog post that 2025 would be big for AI agents, tools that can automate tasks and take actions on your behalf.
… OpenAI announced on Thursday that it is launching a research preview of Operator, a general-purpose AI agent that can take control of a web browser and independently perform certain actions. Operator is coming to U.S. users on ChatGPT’s $200 Pro subscription plan first. OpenAI says it plans to roll this feature out to more users in its Plus, Team, and Enterprise tiers eventually. — Read More
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