xAI, Elon Musk’s AI startup which is taking on OpenAI, has now secured a total of $6 billion in equity financing, according to a filing with the US Securities and Exchange Commission (SEC) on Thursday. The fresh round of funding has been in progress for months and brings bringing its total capital raised to $12 billion since its launch in 2023. This comes just months after its $6B Series B earlier this year.
The latest infusion of capital was contributed by 97 investors, with individual stakes starting at $77,593, but the identities of these investors were not disclosed in the filing. It also values xAI at an estimated $40 billion, doubling its valuation from earlier this year, and follows speculations that suggested the company was targeting a valuation as high as $50 billion. For now, it is far behind OpenAI – another major name in the AI landscape (OpenAI was last valued at $157 billion).
Speaking of xAI, the firm has pursued an aggressive growth trajectory and has gained the attention (and investments) of several prominent venture capital firms such as Sequoia Capital and Andreessen Horowitz. Many of these investors are also involved in Musk’s other ventures, including X (the erstwhile Twitter). Earlier this year, xAI closed a $6 billion funding round in May, which valued the company at $24 billion, and reports suggest that the latest funding round included only those who had previously invested in xAI.
In recent times, one of xAI’s primary focuses has been building out its infrastructure to support AI research. The centerpiece of this effort is the Colossus AI training system, located at a new facility in Memphis, Tennessee. This supercomputer, which currently houses 100,000 Nvidia H100 graphics processing units (GPUs), and is a powerful AI training system. Going forward, Musk has plans to scale Colossus further, with a target of accommodating up to 1 million GPUs in the future, as well as include next-generation Nvidia H200 GPUs. Local officials have hailed the Memphis facility as the largest single investment in the city’s history, attracting other major technology players such as Nvidia, Dell Technologies, and Super Micro Computer Inc.
xAI has also made advancements in the generative AI space, and while it is yet to catch up to the likes of OpenAI’s ChatGPT or Google’s Gemini, the firm has its own offering in the form of Grok. The generative AI chatbot is integrated into Musk’s X platform, and Musk describes the chatbot as “maximally truth-seeking.” It is currently available to X Premium subscribers and select free users, and xAI has plans for a standalone app set for release sometime later this year. xAI has also launched an API, allowing businesses to integrate Grok into their own platforms as well.
