DeepSeek's 80% gross margin secret is its org structure, not just tech
zephyr_z9 · x · 2026-10-24
zartbot published an essay arguing that DeepSeek's open-sourced "money-printing" inference stack achieves its 80% gross margin thanks to a unique organizational setup. At other labs, each team has its own KPIs: an infra engineer proposing deeper KV cache compression inevitably faces pushback from the algorithm team if it hurts model performance.
The essay goes further: even if the algorithm team agrees to try a new architecture enabling greater KV cache compression, the experiment may still fail — cross-team friction is the hidden cost competitors can't easily replicate.
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