xAI, the artificial intelligence startup founded by billionaire tech magnate Elon Musk, has announced that it has secured $6 billion in its most recent funding round from investors. The company is currently facing intense competition in the artificial intelligence market.
The Grok chatbot, the company’s primary product, has received backing from US venture capitalists, chipmakers NVIDIA and AMD, and investment funds from Saudi Arabia and Qatar, among others.
Musk has consistently cautioned that AI poses a threat to human civilization; however, he is making a concerted effort to secure a larger portion of the sector’s investment, and xAI has already raised $6 billion in May.
The company is currently valued at an estimated $50 billion, making it one of the most valuable businesses in the world. However, it is still dwarfed by its principal competitor, OpenAI, which is valued at an estimated $157 billion.
Critics have emphasized that AI firms are still in the process of burning through cash and lack a clear path to profitability, despite the exorbitant estimates.
On Monday, xAI disclosed that it would allocate the funding to the development of “groundbreaking products that will be utilized by billions of individuals.”
It would also “further the company’s mission to comprehend the true nature of the universe by expediting the research and development of future technologies.”
Musk, who is also the CEO of SpaceX and Tesla and is a prominent supporter of the incoming US president, Donald Trump, stated on his X account that “a significant amount of compute is required” to enable AI products.
He founded the organization in July 2023, shortly after he signed an open letter advocating for a moratorium on the advancement of advanced AI models.
Musk is currently pursuing legal action against OpenAI, a provider of ChatGPT, which he co-founded as a non-profit in 2015 before departing in 2018. Musk claims that the company’s transition to a for-profit entity violates legally binding agreements.
