In a significant move to cement its position in the AI industry, Elon Musk’s xAI has secured $6 billion in Series B funding from investors including Saudi Arabia’s Kingdom Holding.
Business Insider reports that the AI startup, barely a year old, has attracted investments from prominent venture capital firms such as Andreessen Horowitz and Sequoia Capital, as well as Saudi Arabia’s Kingdom Holding. This funding round marks a crucial step for xAI in its quest to compete with Sam Altman’s OpenAI, the creator of the highly acclaimed ChatGPT.
Elon Musk took to X/Twitter to share the news, stating, “There will be more to announce in the coming weeks.” In a subsequent post, Musk revealed that xAI’s pre-money valuation stood at an impressive $18 billion, highlighting the company’s potential and investor confidence in its future prospects.
Pre-money valuation was $18B
— Elon Musk (@elonmusk) May 27, 2024
This announcement comes as the first official confirmation of xAI’s fundraising efforts, following Musk’s previous denials of reports from Bloomberg and the Financial Times regarding the company’s outreach to investors. The substantial influx of capital will be crucial for Musk’s vision of establishing xAI as a formidable alternative to OpenAI, a company he co-founded with Altman before leaving its board in 2018.
OpenAI boss Sam Altman (Kevin Dietsch/Getty)
OpenAI, valued at $80 billion or more according to a report by the New York Times, has been at the forefront of AI development with its groundbreaking ChatGPT. However, Musk has expressed disappointment in the direction OpenAI has taken, particularly its partnership with Microsoft, which he believes contradicts the company’s original nonprofit mission.
In February, Musk filed a lawsuit against OpenAI, accusing the company of violating its nonprofit status by partnering with Microsoft. “OpenAI was created as an open source (which is why I named it ‘Open’ AI), non-profit company to serve as a counterweight to Google, but now it has become a closed source, maximum-profit company effectively controlled by Microsoft,” Musk wrote on X/Twitter.
OpenAI was created as an open source (which is why I named it “Open” AI), non-profit company to serve as a counterweight to Google, but now it has become a closed source, maximum-profit company effectively controlled by Microsoft.
Not what I intended at all.
— Elon Musk (@elonmusk) February 17, 2023
Read more at Business Insider here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
COMMENTS
Please let us know if you're having issues with commenting.