Musk’s xAI closes $15 billion funding round in December

Elon Musk’s artificial intelligence startup xAI plans to close a $15 billion round next month at a pre-money valuation of $230 billion, a person familiar with the matter tells CNBC’s David Faber.

The deadline for allocations is by the end of Tuesday, and the round is scheduled to end on December 19, the sources said.

This confirms an earlier report by CNBC that the company was raising $15 billion. of tesla The CEO later called reports about the round “false” in a post on social media platform X.

Sources told CNBC at the time that xAI plans to use the bulk of the funding to fund graphics processing units that will be responsible for powering language models at scale.

CNBC reported in September that the startup was aiming to raise $10 billion at a $200 billion valuation.

This funding round is a further sign of the insatiable demand for AI tools. As investors pour more money into companies building fundamental AI models, companies like OpenAI and Anthropic have raised billions of dollars and reached sky-high valuations.

Sam Altman’s OpenAI completed a $6.6 billion stock sale last month at a valuation of $500 billion, and Reuters recently reported that the ChatGPT maker is aiming for a $1 trillion initial public offering.

Anthropic closed a $13 billion funding round in September, nearly tripling its valuation since March.

Musk’s xAI is responsible for creating the Grok chatbot, which has come under fire for spreading hate speech, including anti-Semitic content. The company recently debuted Grokipedia, an AI-powered competitor to Wikipedia.

Musk announced in March that he would merge xAI and X in a deal that valued the social media platform at $33 billion.