Elon Musk’s xAI raises $6bn to grow its Grok chatbots

27 May 2024

Image: © Ascannio/Stock.adobe.com

With backing from A16z, Sequoia Capital and others, xAI plans to bring its first products to market and challenge other players in the AI sector.

xAI, the AI start-up founded by Elon Musk, has raised $6bn from various high-profile investors to bring its products to market.

The Series B funding round included participation from Andreessen Horowitz (A16z), Sequoia Capital, Fidelity Management and Research Company, Valor Equity Partners, Vy Capital, and Prince Alwaleed Bin Talal and Kingdom Holding.

xAI was announced last year by Elon Musk as a way to move into the rapidly growing AI sector. The company also claims it intends to “understand the true nature of the universe”.

The start-up made a move into the generative AI space with the launch of Grok, its chatbot with a “rebellious streak” as a counter to popular models such as ChatGPT. Since then, xAI has worked on various AI models and has released some open-source offerings.

“With the open-source release of Grok-1, xAI has opened doors for advancements in various applications, optimisations and extensions of the model,” the company said in a blogpost. “xAI will continue on this steep trajectory of progress over the coming months, with multiple exciting technology updates and products soon to be announced.”

xAI has made the test versions of its Grok models available to limited users – mainly premium subscribers of the X social media platform. The company said it will use the fresh funding to take xAI’s first products to market, build advanced infrastructure and “accelerate the research and development of future technologies”.

“xAI is primarily focused on the development of advanced AI systems that are truthful, competent and maximally beneficial for all of humanity,” the start-up said. “The company’s mission is to understand the true nature of the universe.”

Musk has been openly critical of OpenAI and other companies in the AI sector, while taking steps of his own to join the generative AI race. Earlier this year, he sued OpenAI and its CEO Sam Altman for not sticking to the company’s original objective of developing AI for the benefit of humanity.

In response, OpenAI shared details about its history with the billionaire and claims Musk supported a for-profit model in 2017, wanted to take full control of the company and suggested attaching the business to Tesla “as its cash cow”.

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Leigh Mc Gowran is a journalist with Silicon Republic