Elon Musk’s artificial intelligence company, xAI, announced on Monday that it has raised $6 billion in a major funding round. The funds will support the development of its infrastructure and accelerate research efforts, as noted on the company’s website. Major investors in this round included BlackRock, Fidelity, and Sequoia Capital.
“A lot of compute is needed,” Musk shared in a post on X, the social platform he owns.
The funding could boost xAI’s valuation to an estimated $35–$40 billion, a significant increase from its earlier $24 billion valuation reported this year.
Musk launched xAI in 2023, entering the AI race after the industry had already seen a surge of innovative products capable of generating text, images, and videos. To compete, Musk quickly established a massive supercomputer in Memphis to power Grok, xAI’s chatbot, which is available to subscribers on X.
Musk previously co-founded OpenAI but left in 2018 due to disagreements with other founders, including CEO Sam Altman. He later filed a lawsuit against OpenAI, claiming its transformation into a for-profit entity violated its original mission. OpenAI denies these claims, arguing Musk’s actions aim to hinder its progress while he builds a rival.
Despite concerns about AI’s risks, Musk believes he can create safer AI systems. To accelerate xAI’s growth, Musk has used data from X to train its models. Some investors who backed Musk’s acquisition of X in 2022, such as Andreessen Horowitz and Saudi Arabia’s Kingdom Holding, have also supported xAI.
With this funding, xAI is poised to compete with major players in the rapidly evolving AI industry
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