Elon Musk’s artificial intelligence start-up, xAI, is reportedly in discussions with global investors to secure funding of up to $6 billion, according to sources familiar with the matter cited by the Financial Times. The potential fundraise could catapult xAI’s valuation to an impressive $20 billion, a testament to the growing prominence of AI in a market marked by subdued start-up funding.
The AI industry has witnessed increased attention, driven in part by the success of OpenAI’s chatbot, ChatGPT. Elon Musk’s xAI, which launched “Grok” last year as a rival to ChatGPT, has seized the opportunity to capitalize on the momentum. Notably, Google-backed Anthropic and Microsoft-backed Inflection AI have also secured funding in recent months.
Reports suggest that xAI has been engaging in talks with family offices in Hong Kong and is actively seeking investments from sovereign wealth funds in the Middle East. Elon Musk has reportedly approached investors in Japan and South Korea as part of the fundraising efforts.
While Musk’s office has not yet responded to Reuters’ request for comment, the Tesla CEO has been vocal about his commitment to building safer AI. Last month, xAI filed with the US Securities and Exchange Commission, signaling its intention to raise up to $1 billion in an equity offering.
However, Musk has also sounded a note of caution about the development of AI and robotics outside of Tesla. Earlier this month, he expressed discomfort with building Tesla into an AI leader unless he could secure 25% voting control.
