ELON Musk’s artificial intelligence (AI) company xAI is canvassing potential investors for a roughly US$10 billion funding round that would value the company at about US$75 billion, according to a source with knowledge of the matter.
Existing investors including Sequoia Capital, Andreessen Horowitz and Valor Equity Partners are in talks to participate in the transaction, said the source, who asked not to be identified discussing private information. Terms of the round are not finalised and could still change.
Representatives for xAI and Valor did not immediately respond to a request for comment. Representatives for Andreessen Horowitz and Sequoia declined to comment. The New York Post previously reported xAI could be valued at US$75 billion.
xAI has raised billions at a rapid pace. The company was last valued at about US$51 billion, according to data compiled by PitchBook. The company said in December it had raised US$6 billion in funding in a Series C round, after announcing another US$6 billion funding round in May.
The company is a competitor to OpenAI, the AI giant that Musk helped found. He recently made an unsolicited US$97.4 billion offer to buy the assets of the non-profit that controls OpenAI. XAI’s main product, a chatbot called Grok, is available through his social network X, formerly known as Twitter.
On Thursday (Feb 13), Musk praised his upcoming Grok 3 chatbot as an AI model that is outperforming others that have been released thus far, adding the world would get to see it in a matter of weeks. XAI is also in talks to buy servers from Dell Technologies, a deal worth more than US$5 billion.
In December, xAI said investors 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.
A slew of other investors have also backed the company including Nvidia, DFJ Growth, Advanced Micro Devices’ AMD Ventures, Petra Equity Partners, Transform Investment Group and Flat Capital, PitchBook data shows. BLOOMBERG
