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Elon Musk’s xAI targets $6B to take on ChatGPT fame and rival OpenAI

Elon Musk
Picture credits: ChinaImages/DepositPhotos

Since the launch of ChatGPT in 2022, the tech scene has been bustling with endeavours to create their versions of generative AI. Industry titans, including Google, Alibaba, and Meta are actively striving to develop their equivalents to ChatGPT. Startups like Anthropic, supported by a $300 million investment from Google, and Stability AI are also making significant advancements in this revolutionary domain.

$6B for Elon Musk’s xAI

At a time when the AI race has been heating up with several investors signing big cheques for startups, Elon Musk, the billionaire CEO of Tesla and owner of xAI is in talks to raise $6 billion from global investors at a proposed valuation of $20 billion. Reportedly, the company is in talks with family offices in Hong Kong and is targeting sovereign wealth funds in the Middle East. 

The $6 billion fundraising would be much higher than the $1 billion goal xAI had set last month in a filing with the US Securities and Exchange Commission. This follows Musk’s denial of raising $500 million in commitments from investors toward its goal. 

Grok, a ChatGPT rival

Last year, Elon Musk offered a preview of his company’s chatbot dubbed Grok, which is similar to ChatGPT. It was stated that the model has been trained with data collected from X (formerly Twitter) bought by Musk for $44 billion in 2022. 

As per Musk, Grok is both smarter and funnier than its rivals and can answer spicy questions that are rejected by most other AI systems. During its preview, Musk said that the xAI startup would be integrated into his social media platform X, and also be available as a standalone app.

The tech titan started the company after tech giants continued to invest heavily in the Gen AI technology. Elon Musk started xAI in July after hiring researchers from OpenAI, Google DeepMind, Tesla, and the University of Toronto. 

Earlier this month, Musk also warned about developing AI and robotics outside Tesla, unless he gets more voting control at the company. He said he would be uncomfortable building Tesla into an AI leader unless he had 25% voting control. 

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