xAI has raised $6B to take on its competition
Musk's AI startup, xAI, recently announced the successful closing of a Series B at a $18 million pre-money valuation. The company plans to launch its first products to market, build on its infrastructure, and accelerate its R&D efforts.
Investors, including Valor Equity Partners, Vy Capital, Andreessen Horowitz, Sequoia Capital, Fidelity Management & Research Company, Prince Alwaleed Bin Talal, and Kingdom Holding Company, contributed to xAI's $6 billion Series B, placed the company at a $18 billion pre-money valuation, which reports state gives a quarter of the company to the investors. Moreover, Elon Musk has ensured that X, the social network he owns, has a stake in xAI, so the former can benefit from any good fortune occurring to the latter.
For a company under a year old, xAI has made impressive strides, from launching Grok-1 in November 2023 to the recent announcements of Grok-1.5 with long-context capabilities and visual understanding. The company also famously made an "open-source" Grok-1 release, including the pre-training model checkpoint weights and architecture but no training code or data. The move may have given xAI the moral high ground over OpenAI, which Musk famously sued, but it is at best partially transparent since it only reveals part of the process behind the model's creation.
Per the blog post communicating the Series B closing, xAI's primary focus is "the development of advanced AI systems that are truthful, competent, and maximally beneficial for all of humanity." To achieve this, xAI plans to use the raised funding to bring its first products to market, strengthen its infrastructure, and boost its research and development efforts.
