Elon Musk’s artificial intelligence company, xAI, has raised $6 billion, saying it will help bring the startup’s “first products to market, build advanced infrastructure, and accelerate the research and development of future technologies”.
What is xAI?
Announced in July 2023, xAI is separate from X Corp and it will “work closely” with Musk’s other companies, including X (formerly Twitter) and Tesla, which uses AI for its self-driving cars. Musk’s ChatGPT rival is called Grok, which launched in November and was trained on and integrated into X.com.
Isn’t OpenAI ahead?
In terms of funding, OpenAI is ahead. Musk said in a social media post that the funding round valued the company at $18 billion, not including the new money. Funding in the new round came from several sources, according to xAI, including Andreessen Horowitz, Sequoia Capital, and Saudi Arabian Prince Al Waleed bin Talal. If we look at capital raised, xAI now ranks alongside Anthropic, which has raised more than $8 billion since it was established in 2021. Microsoft has invested about $13 billion in OpenAI, while Amazon.com has put about $4 billion into Anthropic.
Wasn’t Musk a part of OpenAI?
Elon Musk was a co-founder of OpenAI but he left in 2018. He had been an important bankroller for the company at its launch in 2015, appearing on stage at an academic conference announcing $1 billion in funding.
What’s next?
A sizeable portion of the money that’s pouring in may go towards hardware that’s needed to power AI development. For example, Nvidia’s upcoming Blackwell B200 AI graphics cards cost between $30,000 and $40,000 apiece. Last week, a report from The Information said that xAI would need 100,000 of Nvidia’s current H100 chips for a supercomputer to power an upgraded version of its Grok AI chatbot.
