Xai, an artificial intelligence startup at Elon Musk, is in talks to raise new funding that could be highly valued from $80 billion to $120 billion more than a month ago.
The talks are in the early stages and could rise or fall as Xai's rating progresses, people who spoke anonymously said. Investors are debating $20 billion in the company, but that figure could change too.
The talks follow a massive fundraising effort by Openai, a San Francisco startup that said it had shut down a fundraising round valued at $300 billion in March. Openai launched an AI boom with the release of ChatGpt in late 2022, causing a surge in funding for other AI companies, including Xai.
Currently, Xai is intertwined with Musk's social media company X. In March he said he sold X to Xai. Musk said the trading of all shares valued Xai at $80 billion and X and $33 billion. Xai's previous valuation from the December funding round was about $40 billion.
Grok, a chatbot created by Xai, is trained with data posted by X users and is available for use with X. X's banker said this year that a portion of the social media company's revenue comes from Xai.
The enthusiasm of AI companies was cooled at the end of last year as several well-known startups folded into tech giants like Google and Amazon. However, Xai and Openai are one of the few that continue to seek billions of funds to build key AI technologies.
Musk declined to respond to requests for comment on Xai. Details of the consultation have been reported previously by Bloomberg.
(New York Times sued Openai and its partner Microsoft over copyright infringement of news content related to AI systems.)
Musk, along with entrepreneur Sam Altman and others, helped find Openai in 2015. He parted ways with the organization about two years later after a dispute over that direction. At the time, Openai was a non-profit organization.
After Musk left Openai, Altman turned it into a for-profit business, allowing him to raise the vast amount of money needed to build AI technology. These technologies learn skills by analyzing huge amounts of digital data.
After ChatGpt was released in 2022, Musk created Xai and built similar technology. Around the same time, Musk sued Openry, claiming that Openry and two of its founders, Altman and Greg Brockman, had breached the company's incorporation agreement by moving commercial interests ahead of public interest. Musk was resurrected in federal court in August after dropping the lawsuit months later.
