Elon Musk, the tech billionaire, has rejected reports about his artificial intelligence startup xAI securing $500 million in funding. He addressed these rumors through posts on the social media platform X (formerly known as Twitter).
Elon Musk responded to two users on the platform, clarifying to one that the information was “simply not accurate.” In response to another user, he dismissed the original Bloomberg report as “fake news.”
How it began… https://t.co/97ylLlTyKz pic.twitter.com/eRA1JJ8oVX
— Walter Isaacson (@WalterIsaacson) January 20, 2024
Conflicting Information about Funding for Elon Musk’s AI Company
Conflicting information surrounds xAI’s funding. According to Bloomberg, discussions suggested a valuation between $15-20 billion, with claims of the startup securing $500 million commitments from investors, aiming for a total of $1 billion. Elon Musk dismissed this as “fake news.” The report mentioned ongoing discussions targeting a tender offer valued between $500 million and $750 million. Sources revealed a potential share price of around $95 each.
xAI has not provided an official statement, but according to Bloomberg, sources revealed ongoing discussions. The company remained silent in response to queries, as reported by Reuters.
In December, Musk contradicted reports of fundraising for xAI, despite the startup filing with the U.S. securities regulator, outlining plans to raise $1 billion through an equity offering. The filing also indicated that xAI had already secured around $135 million, without disclosing the investors’ names.
Elon Musk introduced xAI in July 2023 as a response to concerns about AI efforts from major tech companies. Musk consistently criticized these companies for what he perceived as excessive censorship and insufficient safety measures in their AI initiatives.
xAI aims to compete with industry giants like Google, Microsoft, OpenAI, and Anthropic. Musk unveiled xAI’s first language model, Grok, in November, which is trained on data from X and has real-time access to the social media platform.
You can also read about a latest update that “OpenAI allows use of its AI for Military and Warfare Purposes“ in detail on our website.
What is xAI?
Elon Musk founded xAI in Nevada on March 9, 2023, and the company has been based in the San Francisco Bay Area, California, since then. Musk appointed Igor Babuschkin, previously affiliated with Google’s DeepMind unit, as the Chief Engineer.
On July 12, 2023, Musk officially announced the establishment of xAI. He attributed the chosen date (7 + 12 + 23 = 42) to the book “The Hitchhiker’s Guide to the Galaxy” by Douglas Adams, where a supercomputer determines that the answer to the ultimate question of life, the universe, and everything is 42. Musk connected this to xAI’s mission “to understand the universe.”
In a December 2023 SEC filing, xAI disclosed raising $134.7 million in external funding out of a potential total of up to $1 billion. However, despite this filing, Elon Musk later stated through X (formerly known as Twitter) that xAI was not actively seeking any funding.
