What DeepSeek Teaches Startups About Resource Efficiency

And Our Tips For Doing More with Less

Who says AI breakthroughs need billion-dollar budgets? DeepSeek just built a game-changing model on a shoestring — and there’s a lesson in that for every startup.

Claiming to have trained its model for $6 million — compared to the $80-100 million used by GPT-4 — DeepSeek is shifting the belief that building these LLMs can only be prioritized by large corporations with billions to commit to the innovation. You can draw plenty of conclusions from this news story, but our favorite is: resource availability doesn’t dictate success.

You can build a lot with little. For startups, this should be reassuring — maybe even invigorating. Finite capital, time, and talent, are all part of the job description of a founder or early-stage CTO/CPO. But that doesn’t mean your builds need to be unsubstantial. It all boils down to resource efficiency.

Having spent the last 12+ years partnering with startups to build and scale products in the leanest way possible (without sacrificing vision and quality), we’ve learned a thing or two about how to do a lot with a little. Here are our recommendations for operating strategically, so startups can achieve more with less:

1. Deliver Immediate Value 

With fewer than 200 employees — compared to the 5,000+ of OpenAI — DeepSeek certainly demonstrates that size isn’t everything, as long as you can prioritize ruthlessly. When you have a small team and a large vision, every sprint needs to be intentional and strategic. 

Business leaders often flood small engineering teams with endless feature requests. At the same time, tech teams can get excited about building cutting-edge tech that doesn't provide user value or move the business forward. This gap in alignment between stakeholders is a recipe for wasted resources.

We find that the best way to close these gaps and deliver value every single sprint is with strategic product documentation. You want to be sure that everything you are building will provide value to users, so putting your thoughts on paper and trying to poke holes in your assumptions is a great test.

Time is tight, so we aren’t recommending you document everything. While creating documentation may seem like a time-waster, a strategic and lean documentation process can actually help you be more resource-efficient immediately. The two pieces of documentation we recommend you focus on:

1. Roadmaps: a living document that outlines the business themes of your product strategy, breaking it down into actionable steps. Most importantly, a roadmap ties your product plans back to your company’s business goals and KPIs to help you prioritize initiatives based on their overall impact. Implementing roadmaps keeps you focused and prevents your team from building in a silo.

2. User stories: brief, simple descriptions of a feature or functionality from the perspective of an end user to capture what a user wants and why. User stories help ensure that every development task delivers value to users. If you’re not building for the user, who are you building for?

“Founders need to have a specific thesis about their customer, especially early on, but you don’t want to be so married to it that you’re not doing what the market is telling you,” says Iggy Moliver, Remedy’s Head of Product and Strategy. “At Remedy, we talk a lot about having strong beliefs that are loosely held. Documentation can help ensure that you’re listening rather than working off false assumptions.”

If you want to see examples of roadmaps and user stories or dig deeper into the ways we recommend using them, check out our blog How to Run Your Startup Like a Product Manager (Even if You Aren't One).

2. Prioritize team leanness and flexibility from the jump

One of the greatest costs for startups — both in terms of time and capital — is product builds. Engineers are often the most expensive line item on a startup’s balance sheet, and hiring them takes time and money. High-turnover rates also regularly plague startups, which delays the time to market. You shouldn’t be wasting resources sourcing talent that is not imperative to getting from one stage to the next.

The problem here: engineering needs of a startup will shift in the first few years as you get customer feedback and as the market shifts — and the DeepSeek news certainly demonstrates how quickly a market can shift. Team agility and flexibility are required to support pivots while minimizing waste.

As Brown University Professor Baba Prasad puts it in her article: “The companies that succeed will be the ones that adapt the fastest. But agility isn’t just about reacting quickly — it’s about having the right kind of flexibility built into your organization before disruption strikes."

You may think that trimming a team back when priorities change is the most effective way to center team efficiency and agility. But then you’ve not only wasted your original recruiting resources, you’ve damaged team culture with layoffs. Does that sound efficient?

Flexibility should be built into your team composition from day one.

“Not only are the traditional hiring methods — long interview processes and coding exercises — time consuming and expensive, there’s currently a lot of debate on how to actually make them effective in ensuring strong technical and cultural fit,” says our friend Dave Stern, President of Stern Devops Group and a Consulting CTO. “My advice is to find a technical partner whose hiring processes you trust, so that you have a time-intensive burden off your plate.” 

Not only does a technical partner take away the hiring burden, it automatically provides capital efficiency because overhead management costs are shifted off of the startup, and the cost of the talent itself is cheaper. On top of this, it allows you to add or scale back talent without layoffs or long transition periods. 

However, as Dave Stern mentioned, trust is the key ingredient for a successful partnership. You need to have full confidence in your service provider’s standards and processes. Otherwise, you can end up with low quality talent that’s cheap, but doesn’t drive value. We often speak with founders and CTOs who have been burned by bad dev-shops in the past, and we’re often sent on rescue missions to right past product mistakes.

To avoid dev-shop regret, check out our advice for choosing a technical partner in our blogs “How To Choose a Technical Partner” and “Essential Questions To Ask A Potential Tech Partner.”

3. Make your dollar go further

Fundraising is a core part of any startup journey. While we love VC funds, we’re also big fans of looking at complementary fundraising strategies that bring along bonus opportunities. By looking for money from diverse sources, you can achieve more with your dollar without over-diluting yourself. Here are a few examples of non-traditional financing sources and the benefits they bring:

• Equity-for-service investments

If you’re on Remedy’s website, then you’re probably familiar with equity-for-service (but if you aren’t you should check out our investments page).

In short: equity-for-service refers to the exchange of work from a service provider (in our case, technical resources) for a percentage of minority ownership. 

The obvious upside of an equity-for-service investment is that the cost of services will be lower, which can improve your company’s margins, extend runway, and create a more attractive burn multiple. In other words, you’ll be more cash efficient. The other upside of an equity-for-service investment is that it aligns incentives with your service provider, who will have skin-in-the-game. 

"For us, the concept of having equity in our partners means that we care about their bottom line as much as other investors,” says Jess Schram, Remedy’s Director of Investments and Incubations. “In other words: it is NOT in our best interest to over-build, over-spend, or staff an unnecessarily bloated team. It IS in our best interest to help you achieve your business goals, build things right the first time, foster a culture of experimentation, and be as lean as possible." 

If you want to learn more about the benefits of equity-for-service investments, you should check out Jess’ blog “Reimagining Startup Financing.”

• Grants and pitch competitions

The obvious perk of grants and pitch competitions is the money you can receive from them without giving up equity. But beyond cash, applying for government and corporate grants and participating in pitch competitions provides a handful of additional cost-free opportunities. 

By simply being in the right room, you get the chance to meet mentors and build relationships with investors who may be helpful in securing funding down-the-line. Pitching your business over and over also means that not only will you perfect your pitch, you’ll be able to perform market validation and gauge market interest by receiving feedback from potential customers and industry experts.

Don’t forget that many of these grants and competitions also come with announcements and media attention — AKA built-in PR opportunities — and some even offer office space, legal services, access to accelerator programs, etc. 

In other words, the prizes go beyond money and let you achieve more without any spend. 

If you want to hear more about alternative fundraising options, check out the panel Jess Schram participated in on the topic.

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The lesson from DeepSeek’s disruption is clear: small players can compete if they learn to maximize their resources. As a startup, knowing how to make the most out of a product build, lean team, and your dollar lets you move the needle on your business at a faster rate, and can in turn lead to a higher valuation during your next fundraise. While there’s no one-size-fits-all way to be a capital-efficient startup, integrating some of these best practices into your company can extend your resources just that much further.

If you want to chat more about Remedy’s processes and recommendations, you can book office hour time with Iggy Moliver, our Head of Product, here, or Jess Schram, our Director of Investments and Incubations, here.