Holy cow.
War Chest
Multi-hyphenate billionaire Elon Musk’s artificial intelligence startup xAI is getting ready to take on the big boys of the industry. On Sunday, the company announced that it had raised a whopping $6 billion during its latest round of funding, putting it in closer competition with bitter rivals OpenAI.
In fact, xAI is now the second most valuable AI startup in the world, The Wall Street Journal reported, with a valuation of $24 billion. But it still has some catching up to do. OpenAI, which is backed by Microsoft, absolutely blows that sum out of the water with an over $80 billion valuation of its own.
That being said, xAI is not even a year old yet. Musk founded the startup in July last year, and to send his pet project into the uppermost echelon of the industry, he’s called on his usual litany of investors, many of whom also backed his Twitter (now X) takeover. (Apparently, they haven’t learned their lesson yet.) These include the titanic Silicon Valley VC firms Andreessen Horowitz and Sequoia Capital, and foreign backers such as Saudi Prince al-Waleed bin Talal at the Kingdom Holdings group.
“The funds from the round will be used to take xAI’s first products to market, build advanced infrastructure, and accelerate the research and development of future technologies,” the company wrote in its announcement.
Scant Offerings
xAI’s flagship product is its AI chatbot called Grok, released in November. The potty-mouthed ChatGPT clone was trained on users’ posts made on X and is available to paid subscribers.
With that limited rollout — not many are willing to pay for a hollowed-out Twitter — Grok hasn’t exactly set the world on fire. Mainly, it’s gained a reputation for edgy jokes and making off-the-wall claims.
Despite that, Musk’s ambitions for his AI venture are apparently lofty: he’s said that he aims to build a “maximum truth-seeking AI that tries to understand the nature of the universe” — an ethos that is matter-of-factly restated in the company’s latest funding announcement.
Open Season
But Musk’s ambitions are seemingly also very petty, as there’s a lot of bad blood between him and OpenAI. Musk co-founded the company in 2015, but left three years later after heated disputes over its direction.
Since then, he’s publicly raged about OpenAI’s fishy transition from a non-profit to creating a lucrative for-profit arm, and in March sued the company on those grounds. He’s also warned about the dangers of AI technology.
But perhaps above all, Musk simply perceives OpenAI and ChatGPT as too “woke.” Grok is meant to be the free-speech absolutist’s answer to that, but it too has apparently fallen victim to the so-called “woke mind virus.”
Now flush with enormous amounts of investment, xAI could finally pose a serious challenge to OpenAI’s dominance. It’s unclear what all those funds will be put towards, but Musk teased on Monday that “there will be more to announce in the coming weeks.”
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