Elon Musk’s artificial intelligence startup xAI is raising as much as $1 billion through an equity offering as the company ramps up efforts to catch rivals Google and ChatGPT creator OpenAI, a filing revealed Tuesday.
The filing with the Securities and Exchange Commission notes that xAI has already raised $134.7 million against the total offering of $1 billion.
The company said it has “entered into a binding and enforceable agreement for the purchase and sale” of the remaining $865.3 million.
Musk — who also owns X Corp., the parent of the social media site X — is raising money at a valuation that will likely be between $4 billion and $10 billion, a private placement source told The Post.
This is his first known fund-raising round for xAI, the source added.
Last month, xAi released an early beta version of its Grok chatbot, a large-language model said to be modeled after “The Hitchhiker’s Guide to the Galaxy” and integrated into X.
Musk has described xAI’s first product offering as “the best that currently exists.”
The world’s richest man, who is prone to sharing important updates about his various business interests via his X account, has yet to comment on the filing or his plans for the raised money.
Musk has not disclosed specific outside investors — though he previously noted in a Nov. 19 post that X Corp. investors “will own 25% of xAI.”
The SEC filing lists Musk as the executive officer and director at xAI, while his longtime fixer Jared Birchall listed as its “corporate secretary.”
The $1 billion raise is part of a rapid ramp-up at Musk’s AI startup, which he rolled out in July.
AI researcher Igor Babuschkin, formerly of Google-owned DeepMind, is leading xAI.
The startup is working closely with Musk’s other companies, including Tesla and X, formerly Twitter.
Musk has argued that current chatbots exhibit a left-wing bias and has espoused the need for what he called “TruthGPT” that will be a “maximum truth-seeking AI that tries to understand the nature of the universe.”
It couldn’t immediately be learned if xAI plans to seek more than $1 billion, though the source said there are expectations that Musk will come to private markets for more funds in January.
Musk also is expected to raise money for two of his other companies, SpaceX and Boring Company, next month, the source said.
Source: NYPOST