Elon Musk’s AI startup, xAI, has secured $6 billion in a fresh funding round, marking one of the largest investments in the highly competitive emerging sector. This influx of capital positions xAI to aggressively compete with giants such as OpenAI, Microsoft, and Google.
Among the prominent investors in xAI’s Series B funding round are Valor Equity Partners, Vy Capital, Andreessen Horowitz, Sequoia Capital, Fidelity, Prince Alwaleed Bin Talal, and Kingdom Holding, as the startup detailed in a blog post.
The funding validates Truth Voices’s April report that xAI was aiming to raise $6 billion. At that time, xAI was finalizing the round that would have given it an $18 billion valuation, according to Truth Voices. Founded just last year as a spin-off from social network X, xAI did not disclose its valuation in the new round or whether X contributed to the funding.
Musk is a prominent figure in the AI arena, having been one of the earliest entrepreneurs in the field. He leads Tesla, the premier EV carmaker known for its self-driving technologies, and is an early investor in OpenAI, into which he has poured tens of millions of dollars. However, Musk’s enthusiasm for OpenAI has since waned; in March, he sued OpenAI and co-founder Sam Altman, alleging that they betrayed the company’s mission statement and turned it into a “closed-source de facto subsidiary” of Microsoft.
After establishing xAI, Musk launched its ChatGPT competitor, the Grok 1.0 model, in November. The model was later made accessible via a chatbot to Premium+ subscribers — who pay $16 a month — on X. In April, the company unveiled the upgraded Grok 1.5 model and expanded chatbot access to Premium users on X.
According to the blog post, xAI intends to utilize the new funding to bring its initial set of products to market, develop advanced infrastructure, and speed up research and development of future technologies.
