Elon Musk’s AI company, xAI, announced on Sunday that it raised $6 billion in a Series B funding round to bring its first products to market. The startup initially disclosed it was looking to raise new capital in April.
Also Read: Elon Musk’s AI Venture xAI Seeks $6 Billion in Funding
Valor Equity Partners, Vy Capital, Andreessen Horowitz, Sequoia Capital, Fidelity Management & Research Company, Prince Alwaleed Bin Talal, and Kingdom Holding, among other companies, participated in the round.
xAI Reaches $24 Billion Post-Money Valuation
According to Musk, xAI’s pre-money valuation was $18 billion. However, the new raise puts the company at a $24 billion post-money valuation, per Reuters.
Also read: Musk’s Grok Threatens ChatGPT Dominance
xAI intends to use the new funds to expand its AI products and research efforts, which could be seen as a move to compete with established AI players like Google and OpenAI.
Grok is xAI’s response to ChatGPT and Gemini. The company launched its chatbot four months after the announcement of xAI in July 2023.
xAI to Take Its First AI Product to Market
Grok is only accessible through X (formerly Twitter) and to paying users. The chatbot is not a standalone app compared to ChatGPT. This means users outside X cannot access Grok. But that could change soon, according to the announcement Sunday.
Also read: X Rolls Out Its AI Chatbot Grok to EU Users
“The funds from the round will be used to take xAI’s first products to market, build advanced infrastructure, and accelerate the research and development of future technologies.”
xAI
xAI is expected to make new announcements in the coming weeks, according to Musk.
There will be more to announce in the coming weeks
— Elon Musk (@elonmusk) May 27, 2024
Musk Open-Sources Grok, Goes After OpenAI
The development today follows the release of Grok-1.5V in April, the most improved version of the xAI model. Cryptopolitan reported that Grok-1.5V is the first-generation multimodal model that can comprehend and process visual information in addition to complex texts.
A month earlier, xAI open-sourced its Grok-1 AI model, releasing the weights and architecture of about 314 billion parameters used in training the model.
OpenAI is a lie
— Elon Musk (@elonmusk) March 11, 2024
The move happened after Elon Musk had sued OpenAI for being too closed with their ChatGPT model.
“OpenAI, Inc. has been transformed into a closed-source de facto subsidiary of the largest technology company in the world: Microsoft,” Musk’s lawyers claimed in the lawsuit.
Musk was among the earlier founders of OpenAI. He reportedly invested over $40 million in the AI company before parting ways in 2018.
