Updated December 25, 12:21 p.m. Pacific: Added details of xAI’s valuation and Kingdom Holdings’ contribution.
xAI, Elon Musk’s AI company, has raised $6 billion in a Series C financing round.
The company announced this week that Andreessen Horowitz , Blackrock, Fidelity, Lightspeed, MGX, Morgan Stanley, OIA, QIA, Sequoia Capital, Valor Equity Partners, Vy Capital, Nvidia, AMD, and others participated.
Kingdom Holdings, the Saudi conglomerate holding company, invested roughly $400 million in the round, according to a public filing. The filing also revealed that xAI is now valued at $45 billion, close to double its previous valuation.
The new cash brings xAI’s total raised to $12 billion, adding to the $6 billion tranche xAI raised in May.
According to the Financial Times, only investors who’d backed xAI in its previous fundraising round were permitted to participate in this one. Reportedly, investors who helped finance Musk’s Twitter acquisition were given access to up to 25% of xAI’s shares.
“xAI’s most powerful model yet … is currently training and we are now focused on launching innovative new consumer and enterprise products,” xAI said in a statement. “The funds from this financing round will be used to further accelerate our advanced infrastructure, ship groundbreaking products … and accelerate … research and development.”
Ramping up AI
Musk formed xAI last year. Soon after, the company released Grok, a flagship generative AI model that now powers a number of features on X, including a chatbot accessible to X Premium subscribers and free users in some regions.
Grok has what Musk has described as “a rebellious streak” — a willingness to answer “spicy questions that are rejected by most other AI systems.” Told to be vulgar, for example, Grok will happily oblige, spewing profanities and colorful language you won’t hear from ChatGPT.
Musk has derided ChatGPT and other AI systems for being too “woke” and “politically correct,” despite Grok’s own unwillingness to cross certain boundaries and hedge on political subjects. He’s also referred to Grok as “maximally truth-seeking” and less biased than competing models, although there’s evidence to suggest that Grok leans to the left.
Over the past year, Grok has become increasingly ingrained in X, the social network formerly known as Twitter. At launch, Grok was only available to X users — and developers skilled enough to get the “open source” edition up and running.
Thanks to an integration with xAI’s in-house image generation model, Aurora, Grok can generate images on X (without guardrails, controversially). The model can analyze images as well, and summarize news and trending events — imperfectly, mind.
Reports indicate that Grok may handle even more X functions in the future, from enhancing X’s search capabilities and account bios to helping with post analytics and reply settings. X recently got a “Grok button” designed to help users discover “relevant context” and dive deeper into trending discussions and real-time events.
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