Elon Musk’s AI startup Xai Is Seeking To Raise $6 Billion In A Funding Round Led By  Silicon Valley
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Elon Musk’s AI startup Xai Is Seeking To Raise $6 Billion In A Funding Round Led By  Silicon Valley

xAI is a Tesla spin-off that seeks to develop artificial intelligence to progress human science knowledge as the firm’s icon Elon Musk implied. It seems that this startup company is trying to be an AI one that is attempting to attract $6. five billion US dollars and is planning to finalize a funding round by June with the firm’s worth estimated at eighteen billion US dollars.

Originally, the startup intended to raise up to $6 billion, but in this latest round, the target has been raised to $6. 5 billion and believes that it will achieve this by the time of this writing in the next few weeks. xAI, the company that owns the AI chatbot Grok, said that it would release the code to the chatbot and power it with data from X, which was originally Twitter. It is on this basis that the startup previously completed its Series C fundraising round where it secured $6 billion at the pre-money valuation of $18 billion. The backers in this funding included Lightspeed Venture Partners, Sequoia Capital, Tribe Capital and Andreessen Horowitz. To generate training data of xAI, Musk intends to tap on data collected from his related companies like X, Neuralink, SpaceX, and Tesla. Although it uses commercial solutions in some of its models and tools, the startup develops its generative AI tools and chatbots on open-source frameworks.

Musk also co-founded OpenAI, the San Francisco nonprofit artificial intelligence research company in 2015 with Altman and Brokmack with the initial investment of $1 billion; however, he resigned from the board after four years due to some divergence. However, the ongoing and famous beef between Musk and OpenAI is that Musk sued OpenAI’s CEO/Founder for going from being “non-profit” to “for-profit” company. Citing the Financial Times, the publisher looks forward to raising nearly $6B for xAI in a funding round with backing from Silicon Valley’s big shots such as Andreessen Horowitz. This would value the startup at $18 billion. xAI raised $19.15 billion in venture capital funds in the first quarter.

Musk has assured investors that xAI can compete with industry leaders like Google, OpenAI, and Anthropic by leveraging data, technology, and business insights from his other ventures, such as X and Tesla. The startup has gained popularity by open-sourcing its AI chatbot, Grok, which employs cutting-edge AI technology for commercial applications. The AI market is currently thriving, with many startups securing substantial investments. For instance, the French startup Hostlilic AI raised $220 million for building AGI, and Mistral, another French AI startup, raised $415 million at a valuation of $2 billion.

Conclusion

xAI is actively seeking to raise $6.5 billion in funds and aims to close a fundraising round in June with a valuation of $18 billion. Initially targeting $6 billion, the startup now expects to achieve $6.5 billion soon. xAI plans to open source its AI chatbot, Grok, which utilizes data from X. The funding round saw participation from Lightspeed Venture Partners, Sequoia Capital, Tribe Capital, and Andreessen Horowitz. xAI is poised to compete with market leaders like Google, OpenAI, and Anthropic by leveraging resources from Musk’s other companies, such as X and Tesla. The startup’s open-sourcing of Grok has already garnered significant attention, showcasing its innovative AI technology for commercial use.

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