xAI, the artificial intelligence company co-founded by Elon Musk, has raised $6 billion in a Series C financing round. The investment is led by Kingdom Holdings, a Saudi conglomerate holding company, which invested around $400 million. This funding brings xAI’s total valuation to $45 billion, close to double its previous valuation.
The new cash will be used to further accelerate the development of xAI’s advanced infrastructure, ship groundbreaking products, and accelerate research and development. xAI has announced that it is currently training its most powerful model yet, which will be launched soon.
xAI was founded last year and released Grok, a flagship generative AI model that powers several features on X, including a chatbot. Grok has been praised by Musk for its ability to answer “spicy questions” without being too restrictive. However, it’s worth noting that Grok still leans to the left.
xAI is facing stiff competition in the generative AI market, with companies like OpenAI and Anthropic dominating the space. xAI has responded by launching an API, allowing customers to build Grok into third-party apps and platforms. The company also recently rolled out a standalone iOS app for its model.
Musk has accused OpenAI of trying to eliminate competitors through “extracting promises from investors not to fund them.” However, OpenAI disagrees with Musk’s interpretation of events. xAI is reportedly working on integrating its models with data from other companies, including Tesla and SpaceX.
xAI has expanded rapidly since its founding, growing from a dozen employees in March 2023 to over 100 today. The company has also secured a deal with the regional power authority in Memphis, which will provide power for its upcoming data center expansion.
The funding rounds of xAI and other AI companies have driven significant investment into the sector, with $31.1 billion invested across over 2,000 deals in Q3 2024 alone, according to PitchBook data.
Source: https://techcrunch.com/2024/12/25/elon-musks-xai-lands-billions-in-new-cash-to-fuel-ai-ambitions