Elon Musk’s xAI raises $6 billion in equity financing as AI race heats up
Elon Musk’s artificial intelligence startup xAI has raised another $6 billion from investors as it ramps up competition with Sam Altman-led OpenAI, according to a regulatory filing.
XAI – which created that snarky “Grok” chatbot available on Musk’s social media site X – raised the funds from a total of 97 investors, the SEC filing revealed on Thursday. The minimum investment in exchange for equity was $77,593.
The filing did not disclose any individual investor names or reveal the size of other investments that occurred as part of the round.
Last month, CNBC reported that the round included $5 billion from sovereign funds in the Middle East and $1 billion from other investors – and boost xAI’s valuation to $50 billion.
The money is expected to help Musk’s AI startup build up its access to computing power.
XAI is expanding its supercomputer facility in Memphis, Tennessee to host at least one million graphics processing units (GPUs), local officials announced earlier this week. The GPUs are needed to train xAI’s models.
Even with its latest fundraise, xAI is still far smaller than OpenAI, which developed a commanding lead in the AI race with its release of ChatGPT.
In October, OpenAI closed a $6.6 billion fundraising round that valued the company at $157 billion. Altman is also leading an effort to restructure OpenAI as a for-profit company – while relegating the non-profit entity that has governed the firm since it was founded in 2015 to less prominent role.
As The Post reported earlier this week, Musk – who cofounded OpenAI but later had a falling-out with Altman – filed a request for an injunction to block the firm from becoming a for-profit.
Musk, who filed a major lawsuit against Altman and OpenAI earlier this year, argued the firm has ran afoul of antitrust law through its collaboration with Microsoft, which has poured billions into its operations as a key investor.
“Plaintiffs and the public need a pause,” Musk’s filing for the injunction said. “OpenAI’s path from a non-profit to a for-profit behemoth is replete with per se anticompetitive practices, flagrant breaches of its charitable mission and rampant self-dealing.”
“It cannot lumber about the marketplace as a Frankenstein, stitched together from whichever corporate forms serve the pecuniary interests of Microsoft and Altman at any given moment,” the filing added.
WIth Post wires
