Elon Musk’s artificial intelligence (AI) company, xAI, has raised $6 billion in its latest funding round through a stake sale, according to a regulatory filing Thursday, aiming to strengthen its position in the AI sector.
New funds
- These new funds were secured via a share offering to multiple investors, where the minimum investment for an outside investor was fixed at $77,593, according to the regulatory filing to the US Securities and Exchange Commission (SEC).
- The filing did not disclose the total size of the share offering.
- A total of 97 investors took part in xAI’s latest fundraising round, showed the company filing.
- The investment is aligned with the Palo Alto, California-headquartered firm’s plans to enhance its presence in the global AI industry by growing its Memphis, Tennesse, supercomputer to accommodate a minimum of one million graphics processing units, reported Reuters on Thursday.
- In November, CNBC reported on xAI’s aims to raise $6 billion with its eyes set on a post-financing target valuation of over $50 billion.
Big number
xAI’s latest fundraising round has increased its total funds to $12 billion, after it raised $6 billion in a previous round in May 2024.
Market competition
Musk, who introduced xAI into the market in 2023, extended his lawsuit against ChatGPT owner OpenAI last month, saying that the AI firm had plans to monopolize the market for generative AI and push back competitors in the market.
In October, OpenAI also secured $6.6 billion in funding, leading to a valuation of $157 billion, noted Reuters.
Net worth
Musk, CEO of Tesla and founder of xAI, is the richest man in the world with a net worth of $343.8 billion as of December 6, 2024, according to Forbes estimates.
Tangent
In August 2024, Musk unveiled a beta version of its most recent AI assistant Grok 2, under the banner of xAI, which includes an image generation tool that’s similar to OpenAI’s DALL-E and Google’s Gemini.
However, xAI’s image generation tool is constrained by lesser limitations on the kinds of images it can create.
The Grok-2 beta can be used by X users who pay for a ‘Premium’ or ‘Premium+’ subscription and can already respond to prompts with both text and images.
In September, the xAI founder denied reports that his company was in talks to receive a portion of future revenues from his chief business, Tesla, in exchange for permission from xAI for the electric vehicle (EV) maker to use its technology.
