Hello and welcome to Eye on AI.
The big news over the weekend was that Elon Musk’s AI company, xAI, has raised $6 billion in a venture capital round that values the not-even-a-year-old startup at $18 billion. That puts xAI right up there close to Anthropic, the AI startup that is closely partnered with Amazon, in terms of both money raised (about $8 billion) and valuation (also about $18 billion), and well ahead of many other hot AI startups. Of course, it's still well behind the more than $13 billion OpenAI has raised from Microsoft and others, and the $80 billion at which it's been valued.
Musk raised the money from a set of usual suspects who have backed his other projects, including his purchase of Twitter. These include Saudi Prince Alwaleed Bin Talal’s Kingdom Holdings, Valor Equity Partners, Vy Capital, Andreessen Horowitz, and Sequoia Capital. Perhaps these investors see xAI, which is leveraging live data from X and being closely integrated with it, as a way of reviving the business prospects of the struggling social network. Whatever their motivation, what’s more interesting is what it says about Musk’s intentions: The billionaire is really serious about building a major AI contender.
