Elon Musk AI Startup xAI Raises $6B at a Valuation of $24B

By Chanak Maduranga

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Elon Musk AI Startup xAI Raises $6B at a Valuation of $24B
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Elon Musk‘s artificial intelligence startup has raised a huge Series B funding round.

The company, xAI, says that it has secured $6 billion in a new round of funding that values it at $24 billion. Investors in the round include Fidelity, Valor Equity Partners, Vy Capital, Andreessen Horowitz, Sequoia Capital, Prince Alwaleed Bin Talal and Kingdom Holding, and others.

A $6 billion funding round is an astonishingly large number for a company launched less than a year ago, and underscores the desire for investors to secure a piece of AI businesses. It is also a bet on Musk, who continues to serve as CEO or a top executive at companies including Tesla, SpaceX, X (formerly Twitter) The Boring Company and Neuralink.

In the case of xAI, its first major product is a large language model called Grok, which is accessible to premium users of X. Grok is Musk’s version of an LLN, competing with the likes of OpenAI’s GPT-4, Anthropic’s Claude and Meta’s Llama.

“xAI is primarily focused on the development of advanced AI systems that are truthful, competent, and maximally beneficial for all of humanity,” the company said in a statement announcing the Series B round. “The company’s mission is to understand the true nature of the universe.”

Musk, of course, is one of the richest people in the world and has launched or acquired a number of companies that touch much of the U.S. economy (SpaceX, for example, is one of the fastest-growing internet providers in the world via its Starlink service).

His efforts at X have been somewhat less successful, after acquiring the social platform for $44 billion two years ago. The company’s value has been written down by Fidelity multiple times since the acquisition, with Musk antagonizing some advertisers via comments he has made at public events.

Now, xAI is at the heart of the company’s turnaround plan, with Grok baked into the premium version of the platform. It is not immediately clear if xAI will seek to make the model more widely available.

Chanak Maduranga

passionate journalist behind 'USA News Now 24', dedicated to delivering timely and accurate updates on US affairs. Committed to journalistic integrity and informing audiences with credible news coverage.

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