Elon Musk’s xAI has secured $6 billion in new cash to boost its AI ambitions
xAI, Elon Musk’s artificial intelligence company, has He grew up $6 billion, according to a filing with the U.S. Securities and Exchange Commission on Thursday.
Investors provided at least $77,593 per deposit (97 people participated, but the document did not reveal their identities). xAI Announced later (confirming some previous reports) that Andreessen Horowitz, Blackrock, Fidelity, Kingdom Holdings, Lightspeed, MGX, Morgan Stanley, OIA, QIA, Sequoia Capital, Valor Equity Partners, Vy Capital, Nvidia, AMD, and others are among them.
The new cash brings the total amount of xAI raised to $12 billion, in addition to the xAI tranche of $6 billion. He grew up This spring. CNBC I mentioned Last November, xAI was aiming for a $50 billion valuation, double its valuation six months earlier.
According to According to the Financial Times, only investors who backed xAI in its previous fundraising round were allowed to participate in this round. It is said that investors who Help Funding awarded for Musk’s acquisition of Twitter access Up to 25% of xAI shares.
Intensifying artificial intelligence
Musk founded XAI last year. Shortly after, the company launched Your puppya pioneering generative AI model that now powers a number of features on X, including an accessible chatbot X Premium Subscribers and Free users In some areas.
Grok has what Musk described as a “rebellious streak” — a desire to answer “interesting questions that most other AI systems refuse to do.” For example, if you are told to be vulgar, your puppy will gladly respond to you, spewing profanities and colorful language that you will not hear from him. ChatGPT.
Musk has it He mocked ChatGPT and other AI systems for being “woke” and “politically correct”, despite Grok’s system – Not wanting to exceed certain limits and Hedging On political topics. He also referred to Grok as “truth-seeking to the extreme” and less biased than competing models, although there are certificate To indicate that your puppy is leaning to the left.
Over the past year, Grok has become increasingly entrenched in X, the social network formerly known as Twitter. At launch, it was your puppy only Available for X-users and developers with enough skills to obtain “Open source” edition. And operate it.
Thanks for Merger Using the open image generator Flux, Grok can create images on the X (without guardrails, which is controversial). The model can also analyze images and summarize trending news and events (Incompletelymind).
Reports indicate that Grok may handle more X jobs in the future Enhance X and search capabilities Account bios To help with post analytics and reply settings.
xAI is playing catch-up with strong competitors like OpenAI and Anthropic in the generative AI race. Company Fired Application Programming Interface (API) in October, allowing customers to build Grok into third-party apps, platforms, and services. It has just launched a Standalone Grok iOS app For the test audience.
Musk asserts that it was not a fair fight.
In a lawsuit A lawsuit has been filed against OpenAI and Microsoft, a close collaborator of OpenAI, and Musk’s lawyers accuse OpenAI of “actively trying to eliminate competitors” like xAI by “extracting promises from investors.” Not to fund themMusk’s lawyer says OpenAI is also taking unfair advantage of Microsoft’s infrastructure and expertise in what lawyers describe as a “de facto merger.”
However, Musk often says that X’s data gives xAI an advantage over competitors. Last month, X change Its privacy policy allows third parties, including xAI, to train models on X posts.
It is worth noting that Musk was one of the original founders of OpenAI, and left the company in 2018 after disagreements over its direction. He has argued in previous lawsuits that OpenAI benefited from his early involvement, but has backed away from the nonprofit’s pledge to make the fruits of its AI research available to everyone.
xAI ecosystem
xAI has outlined a vision whereby its models would be trained on data from Musk’s various companies, including Tesla and SpaceX, and its models could then improve the technology across those companies. It already powers customer support features for SpaceX’s Starlink internet service, according to the Wall Street Journal, and the startup is… He said To hold talks with Tesla to provide research and development in exchange for some of the automaker’s revenue.
Tesla shareholders, for example, object to these plans. Many have filed a lawsuit against Musk Because of his decision to start XAI, arguing that Musk did so Transform both talent and resources From Tesla to what is essentially a competing project.
However, the deals — and xAI products for developers and consumer-oriented products — brought xAI revenue to about $100 million annually. For comparison, anthropic is It is said On pace to achieve $1 billion in revenue this year, OpenAI is targeting $4 billion by the end of 2024.
Musk said this summer that xAI is training the next generation of Grok models at its data center in Memphis, which was apparently built in just 122 days and is currently powered in part by portable diesel generators. The company hopes to upgrade the server farm, which contains 100,000 Nvidia graphics processing units, next year. xAI said in its press release that it plans to fully double that number. (Because of their ability to perform many calculations in parallel, GPUs are the chips of choice for training and running models.)
In November, XAI won consent from the Memphis Regional Power Authority for 150 megawatts of additional power – enough to power nearly 100,000 homes. To win the agency, xAI pledged to improve the quality of the city’s drinking water and supply Memphis’ grid with Tesla-manufactured batteries at discounted prices. But some residents criticized the move, saying it would strain the grid and Get worse Air quality in the area.
Tesla too expected To use the upgraded data center to improve self-driving technologies.
xAI has expanded very rapidly from an operations standpoint during the year since its founding, growing from just ten employees in March 2023 to More than 100 today. In October, startup Move In the old OpenAI offices in San Francisco’s Mission District.
xAI has reportedly told investors that it plans to raise more money next year.
It won’t be the only AI lab raising huge amounts of money. Anthropic newly It received $4 billion from Amazon, bringing the total amount raised to $13.7 billion, while OpenAI received $4 billion. He grew up $6.6 billion in October, bringing the war treasury to $17.9 billion.
Mega deals like OpenAI’s and Anthropic’s pushed AI venture capital activity to $31.1 billion across more than 2,000 deals in Q3 2024. per Beachbook data.
TechCrunch has an AI-focused newsletter! Register here Get it in your inbox every Wednesday.
