Elon Musk’s xAI raises $6B from Valor, a16z, and Sequoia

Elon Musk’s AI startup xAI has raised $6 billion in a new funding round, it said today, in one of the largest deals in the red-hot nascent space, as it shores up capital to aggressively compete with rivals like OpenAI. , Microsoft, and Google.

Valor Equity Partners, Vy Capital, Andreessen Horowitz, Sequoia Capital, Fidelity, Prince Alwaleed Bin Talal and Kingdom Holding are among the backers that have invested in the Series B financing of xAI, the startup wrote in a blog post.

The funding confirms TechCrunch’s April report that xAI was looking to raise $6 billion. xAI at the time was finalizing the round that would have given it a valuation of $18 billion, TechCrunch reported at the time. xAI, which started last year and emerged from social network X, and whether X had also invested.

Musk confirmed that the investment round was valued at $18 billion before the money.

Musk is one of the earliest and most prominent entrepreneurs in the AI ​​space. Tesla, the automobile company he heads, is the leading manufacturer of electric vehicles with autonomous driving technologies. He is also the co-founder of OpenAI, a startup in which he has invested tens of millions of dollars. Musk’s love for OpenAI has since waned: In March, he sued OpenAI and its co-founder Sam Altman for allegedly betraying its mission statement and becoming a “de facto closed-source subsidiary” of Microsoft. He has also accused Google of coding inclination in their AI products.

After forming xAI Year, Musk launched his chatbot ChatGPT, rival Grok 1.0, in November. The company later made the model available to Premium+ users, who pay $16 a month, through a chatbot on X. In April, the company launched the new Grok 1.5 model and also allowed Premium X users access the chatbot. Additionally, the Musk-owned company previewed Grok. multimodal capabilities in April. Earlier this year, the company open sourced the Grok model but without any training code.

xAI plans to use the funds from the new financing round to bring its first set of products to market, build advanced infrastructure and accelerate research and development of future technologies, it said in the blog post. The company will likely seek partnerships to introduce Grok to users beyond X.

The company says its goal is to develop “truthful” artificial intelligence systems. However, Grok’s news summary feature about X is reported hallucinate and generate misleading information.

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