Elon Musk’s artificial intelligence startup, xAI, is in discussions to raise $10 billion in new funding, potentially valuing the company at around $75 billion, Bloomberg News reported on Friday.
Existing investors, including Sequoia Capital, Andreessen Horowitz, and Valor Equity Partners, are reportedly in talks to participate in the funding round. Neither xAI nor the investors responded to Reuters’ requests for comment.
The fundraising effort follows xAI’s recent $6 billion capital injection, which valued the company at $40 billion. The startup is looking to expand its AI infrastructure by increasing its data center capacity to train and deploy AI models.
Musk announced on Thursday that xAI’s latest ChatGPT competitor, Grok 3, is in the final stages of development and is expected to launch within the next two weeks. Speaking at the World Governments Summit in Dubai, Musk claimed that Grok 3 has “very powerful reasoning capabilities” and is outperforming all existing AI models in internal testing.
Musk, who founded xAI in 2023, is currently suing OpenAI to prevent its conversion into a public benefit corporation. Earlier this week, a consortium led by Musk reportedly made a $97.4 billion offer to acquire the nonprofit that controls OpenAI.
Meanwhile, Dell Technologies is nearing a deal to sell more than $5 billion worth of AI servers to xAI, Bloomberg News reported. The servers, equipped with Nvidia’s powerful GB200 chips, are expected to be delivered later this year.
