Elon Musk’s xAI raises $20bn in funding round that doubles valuation – Financial Times
Elon Musk’s xAI said it had raised $20bn in new funding, in an upsized deal that more than doubles its valuation since last spring, despite growing concerns over illegal content generated by its artificial intelligence.
The start-up, which develops the chatbot and model Grok, initially targeted a $15bn round, at a $230bn valuation. On Tuesday, xAI announced the larger-than-anticipated round, with participation from Valor Equity Partners, Fidelity Investment Management, the Qatar Investment Authority and Abu Dhabi fund MGX.
Strategic investors include Nvidia and Cisco, whom the company said would support its computing resources. Nvidia supplies chips to xAI, which powers the training and running of its AI models.
In July, xAI raised $10bn through loans and cash investments to fund construction of its Colossus data centre in Memphis, Tennessee. In June, it sold $300mn of shares in a secondary stock offering.
The announcement comes as scrutiny mounts of xAI, after its image generation feature on Grok created sexualised images of minors and adults, “undressing” them without consent.
Earlier on Tuesday, UK technology minister Liz Kendall said in a statement that the content was “absolutely appalling” and that the company needed to deal with it “urgently”. Creating or sharing non-consensual intimate imagery or child sex abuse material, including AI-generated content, is illegal in the UK.
The company said in a statement posted to X on Saturday that it takes “action against illegal content on X, including Child Sexual Abuse Material (CSAM), by removing it, permanently suspending accounts, and working with local governments and law enforcement as necessary”.
“Anyone using or prompting Grok to make illegal content will suffer the same consequences as if they upload illegal content,” it added.
xAI acquired social media network X for $45bn in March, bringing together two Musk businesses under one umbrella, and combining data, computing power, staff and users. The company said it had more than 600mn monthly active users across both platforms. Users on X can access Grok readily in the app or through comments on posts.
xAI said it was training the next version of its large language model, Grok 5, and planned to launch new consumer and enterprise products. It is also building models to assist its planned expansion into gaming and robotics, as previously reported by the Financial Times.
