Report: xAI Aims to Raise ‘Several Billion Dollars’

Elon Musk’s xAI reportedly aims to raise “several billion dollars” in a funding round that would value it around $40 billion.

The funding discussions are in the early stages and the details could change, The Wall Street Journal (WSJ) reported Tuesday (Oct. 29), citing unnamed sources.

In a Series B funding round completed in May, xAI raised $6 billion and gained a pre-money valuation of $18 billion.

The company said at the time in a press release that it would use the new funding to take its first products to market, build advanced infrastructure and accelerate its research and development (R&D).

Noting the products it had launched in the 10 months since Musk announced the formation of the company in July 2023, the release said: “xAI will continue on this steep trajectory of progress over the coming months, with multiple exciting technology updates and products soon to be announced.”

In September, xAI launched its Colossus 100k H100 training cluster, which Musk said in a post on X is “the most powerful AI training system in the world. Moreover, it will double in size to 200k (50k H200x) in a few months.”

The H200 is an Nvidia GPU designed to accelerate generative AI and large language models.

Nvidia said at the time in a post on X that xAI’s Colossus is “the world’s largest GPU #supercomputer” and it came online “in record time.”

It was reported in July that American venture funding had reached its highest quarterly total in two years thanks to AI.

Venture capital investments in the second quarter increased 47% over the first quarter, fueled largely by major investments in AI firms, such as the $6 billion raised by xAI and the $1.1 billion raised by CoreWeave.

On Oct. 2, OpenAI raised $6.6 billion in new funding, nearly doubling its valuation to $157 billion. The company was previously valued at $86 billion early in the year after employees sold their shares.

It was reported Oct. 20 that AI search company Perplexity is looking to raise about $500 million in a new funding round that would value it at $8 billion. The company was last valued at $3 billion this summer.