Elon Musk's AI Startup xAI Nears $24B Valuation, Aims For $6.5B Funding Round: Report

Elon Musk‘s xAI Corp. is on the brink of concluding a funding round in June that could potentially value the company at over $24 billion, including its latest cash infusion.

What Happened: The funding aspirations of xAI have significantly expanded since January, when the company was reportedly seeking to raise $1 billion, reported Bloomberg, citing a source.

The startup, which is a competitor to OpenAI, has been presented to various Silicon Valley investors based on Musk’s track record at Tesla Inc. and SpaceX.

The company has been in discussions for a financing round of approximately $6 billion, but the finalization of the deal is still pending. The company is now seeking up to $6.5 billion and aims to reach this target in the coming weeks.

The company’s pitch materials also highlighted that xAI and its chatbot, Grok, will be able to utilize high-quality data from X, Musk’s social platform. This access to data is crucial for building large language models, an area where xAI aims to compete with other well-funded businesses such as OpenAI.

The deal will give xAI a pre-money valuation of $18 billion, a metric that does not include the funds raised. Musk, in a remote interview at the Viva Technology conference in Paris, spoke about xAI’s goal of being “as truth-seeking as possible” and criticized other AI models developed by Alphabet Inc.‘s Google and OpenAI as “pandering” to political correctness.

See Also: ‘I Did Not Ask For It:’ Elon Musk Thanks Tesla Team For Putting Together Video Urging Shareholders To Vote For CEO’s 2018 Pay Package

Why It Matters: Musk’s xAI has been making significant strides in the AI space. Earlier this month, the company’s valuation was predicted to exceed $20 billion, which was already a substantial increase from initial expectations.

Musk has also been vocal about his ambitions for xAI, including its potential to be the new late-night comedian.

These developments come at a time when the importance of AI is being underscored, with experts predicting that companies not fully utilizing AI by 2030 will be out of business.

Read Next: Elon Musk Suggests Shifting ‘Consumer Desktops To Linux’ As Satya Nadella Promotes Microsoft’s New Windows AI Feature ‘Recall’ With Photographic Memory

Image Via Shutterstock

This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote