Elon Musk’s artificial intelligence company xAI is raising $15 billion, according to CNBC. This funding adds another $5 billion to the $10 billion reported in September, which valued the company at $200 billion.
Musk called the news “false” via X. Sources told CNBC that a lot of the money in this $15 billion round will fund graphic processing units (GPUs) that underpin large language models.
xAI said “Legacy Media Lies” in response to a Reuters request for comment on the latest fundraise, in what seems to be an automated reply.
Artificial intelligence companies have been reaching sky high valuations of late as they raise massive amounts of capital with the increasing demand for foundational models. In September, AI startup Anthropic closed a $13 billion funding round that roughly tripled its valuation from March. OpenAI closed a $6.6 billion share sale at a $500 billion valuation. The ChatGPT-maker has also laid the groundwork for an IPO of $1 trillion.
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xAI has also dealt with multiple controversies of late. It has faced criticism for its rapid build-out of large, power-hungry data centers in Memphis. The data centers have used natural gas-burning turbines as a power source, emissions from which contribute to air quality problems in the area, according to local researchers.
xAI includes a chatbot called Grok, and launched an AI-based Wikipedia alternative called Grokipedia. Both of these have courted controversy for generating false content. Grok has previously been accused of generating anti-Semitic content and pushing far right propaganda.
READ: Elon Musk launches AI-based alternative to Wikipedia — ‘Grokipedia’ (
Grokipedia was launched in October as a response to what Musk believes is a liberal bias in Wikipedia. While Musk said that the goal of Grok and Grokipedia is “the truth, the whole truth and nothing but the truth,” people have noticed inaccuracies in its articles.
xAI also does business with Musk’s automaker Tesla. Newer Tesla vehicles feature Grok in their infotainment systems. Meanwhile, xAI has purchased tens of millions of dollars’ worth of Tesla’s battery energy storage systems for use at their data centers in Memphis.
Tesla shareholders recently gave a green light to an unprecedented compensation plan for Musk, a package that could potentially value up to $1 trillion. This marks one of the largest executive pay deals in corporate history. This compensation plan has been designed to keep Musk at Tesla as the company advances its work in artificial intelligence and robotics.