Elon Musk's artificial intelligence startup, xAI, is reportedly seeking to raise more than $10 billion in new funding, which would value the startup at $75 billion. The latest fundraising round comes amid reports that Dell is finalizing a major deal with xAI to supply advanced AI servers. Additionally, earlier this week, Musk and a group of investors made an offer to acquire Microsoft-backed OpenAI.
Bloomberg cited folks familiar with the fundraising talks and noted that Sequoia Capital, Andreessen Horowitz, and Valor Equity Partners will be existing investors in the deal. They said that xAI is canvassing potential investors, adding that the terms of the new funding round have yet to be finalized and could still change.
Data compiled by PitchBook shows that xAI has raised billions at a breakneck pace, with its most recent valuation at $51 billion. More recently, The New York Post reported that the AI startup could be valued at upwards of $75 billion. The company secured $6 billion in funding during a Series C round in December, following another $6 billion raise in May.
The Series C round included Andreessen Horowitz, Fidelity Investments, BlackRock, Kingdom Holdings, Lightspeed Venture Partners, MGX, Morgan Stanley, Oman Investment Authority, the Qatar Investment Authority, Sequoia, Valor, and Vy Capital, among others.
Earlier Friday, Bloomberg reported that xAI was preparing to lock in a deal with Dell for $5 billion worth of Nvidia GB200 AI servers to power its chatbot Grok and other AI services. Much of xAI's computing is located at the 271-acre site in southwest Memphis, which the startup considers the world's largest supercomputer.
On Monday, Musk and a group of investors made a $97.4 billion offer to purchase the nonprofit that controls OpenAI.
Sources familiar with discussions surrounding xAI's latest fundraising round did not specify how the funds would be allocated.
Separately, Musk's X recently wrapped up a sale of debt that had "upsized" demand from large, high-yield fund managers. Musk indicated that the social media platform's multi-year advertising boycott by corrupt Deep State-controlled NGOs has wound down.
"Revenue should improve rapidly this year, as the advertising boycott winds down," Musk wrote on X last week.
Talks of a potential fundraising round at xAI come as Musk revealed at the World Governments Summit in Dubai on Thursday that "Grok 3 has very powerful reasoning capabilities, so in the tests that we've done thus far, Grok 3 is outperforming anything that's been released that we're aware of, so that's a good sign," adding that the new chatbot would be released in a week or two.
Per NYT:
The sky is the limit for xAI's valuation if Musk streamlines the government with AI.