Elon Musk’s xAI approaches $24B value with new funding round

Elon Musk‘s artificial intelligence company, xAI, is expected to complete a funding round in June, potentially valuing it at more than $24 billion, Bloomberg reports.

The company aimed to finalize a $6 billion financing earlier this month, but the completion of this deal, which started last year, has yet to occur.

The xAI funding round includes contributions from investors like Andreessen Horowitz and Sequoia Capital, as mentioned in a recent company blog post.

According to a statement from Musk on X, the company’s valuation before this round was $18 billion.

Apologies for my typo, pre-money was $18B

— Elon Musk (@elonmusk) May 27, 2024

The funds will be allocated towards launching xAI’s initial products, developing advanced infrastructure, and boosting research and development for upcoming technologies, the company said.

In response to the funding news, Musk teased on X that “there will be more to announce in the coming weeks.”

xAI’s battle against OpenAI

xAI said it had experienced rapid development over the past year, as outlined in a recent blog post by the company. “From the announcement of the company in July 2023, to the release of Grok-1 on X in November, to the recent announcements of the improved Grok-1.5 model with long context capability, to Grok-1.5V with image understanding, xAI’s model capabilities have improved rapidly.”

The Grok chatbot was released to X Premium Plus users in December. Unlike traditional chatbots, Grok is reportedly programmed to exhibit a politically incorrect and witty personality, drawing inspiration from conservative commentators like Tucker Carlson and Joe Rogan.

“With the open-source release of Grok-1, xAI has opened doors for advancements in various applications, optimizations, and extensions of the model,” the company continued.

The billionaire was once closely associated with OpenAI as a co-founder, but he walked away years ago to follow his own path in AI development, with a bitter fallout ensuing. Musk has taken legal action against his former company and its incumbent CEO, Sam Altman, for allegedly reneging on its original purpose to build AI for the benefit of humanity and not for the pursuit of profit.

Consequently, the company added: “xAI is primarily focused on the development of advanced AI systems that are truthful, competent, and maximally beneficial for all of humanity. The company’s mission is to understand the true nature of the universe.”

Featured image: Midjourney

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Suswati Basu