Elon Musk’s AI startup xAI said today it has raised $6 billion in a new funding round, one of the biggest deals in the hotly anticipated emerging space as it ramps up cash to aggressively compete with rivals like OpenAI, Microsoft, and Google.
Valor Equity Partners, V Capital, Andreessen Horowitz, Sequoia Capital, Fidelity, Prince Alwaleed bin Talal and Kingdom Holding are among the backers who invested in xAI’s Series B funding. I have written In a blog post.
The funding confirms a TechCrunch report from April that xAI was looking to raise $6 billion. TechCrunch reported at the time that the company was finalizing a round that would have valued it at $18 billion. xAI, which was founded last year and spun out of social network X, did not disclose how much it was valued in the new round or whether X had also invested.
Musk was one of the earliest and most prominent entrepreneurs in the AI field. His car company, Tesla, is a leading EV manufacturer with self-driving technology. He was also an early investor in startup OpenAI, investing tens of millions of dollars. Musk’s love for OpenAI has since waned, and in March he sued OpenAI and its co-founder Sam Altman for violating the company’s mission statement and becoming a “closed-source de facto subsidiary” of Microsoft.
Musk launched the Grok 1.0 model, a chatbot rivaling ChatGPT, in November, a year after he founded xAI. The company then made the model available to X Premium+ users ($16 per month) through a chatbot. In April, the company released the new Grok 1.5 model, making the chatbot accessible to X Premium users as well.
xAI plans to use the proceeds from the new funding round to bring its first suite of products to market, build out advanced infrastructure, and accelerate research and development of its future technology, it said in a blog post.
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