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Billion-Dollar Bet: xAI Raises $6 Billion to Supercharge AI Innovation

Daniel Kim Views  

xAI, the developer of Grok, a generative artificial intelligence (AI) of X, has secured a Series B investment of $6 billion. While OpenAI and other competitors are accelerating AI development through massive investments, xAI, led by Tesla’s CEO, Elon Musk, is also entering this war.

On the 27th (local time), xAI announced through a blog post that it received an investment in Series B worth $6 billion. The investment was made by Saudi Arabian Prince Alwaleed bin Talal as well as Silicon Valley’s leading venture capitalists, Sequoia Capital, Andreessen Horowitz, and Fidelity.

Musk revealed on X that the company’s valuation was $18 billion before the investment. With no significant changes in equity evaluation during the Series B investment process, the company’s current corporate value is estimated to be $24 billion, which includes an investment of $6 billion. Bloomberg reported this as “another example of a large-scale investment in AI development” and noted that it is the second major investment for xAI, which was established less than a year ago in July.

xAI plans to use the investment to build infrastructure and invest in research and development (R&D) to introduce the latest AI, such as the Grok-2. xAI stated in its blog, “We have rapidly advanced AI performance by revealing Grok-1, Grok-1.5, and Grok-1.5V, which enable image understanding. We will continue to make steep progress over the next few months and announce exciting new technologies and products.”

With xAI’s successful fundraising, the competition for the development of ultra-large AI is likely to accelerate. OpenAI, the leader in this field, has already received an investment of $13 billion from Microsoft Corporation. Anthropic, known as a contender against OpenAI, has also received an investment of $4 billion from Amazon Inc. after receiving an investment from Google.

Daniel Kim
content@viewusglobal.com

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