Elon Musk's artificial intelligence company xAI is raising $10 billion from investors, sources said, with the round valuing the artificial intelligence startup at $200 billion. It's the latest example of soaring valuations for companies developing basic artificial intelligence models. Earlier this month, Anthropic raised $13 billion at a $183 billion valuation. OpenAI, the industry's largest company, conducted a secondary stock sale that valued it at $500 billion.
The financing comes weeks after Musk raised $10 billion in debt and equity at a valuation of about $150 billion, the report said. In December, xAI raised $6 billion for its artificial intelligence development.
xAI has been the subject of controversy because its Grok chatbot has praised Adolf Hitler and attacked Jews, and once responded to a user's question with comments that had nothing to do with "white genocide" or South Africa.
Grok is also widely believed to lag behind Anthropic's Claude and OpenAI's GPT models in terms of capabilities and number of users.
In March, Musk announced that his artificial intelligence company xAI had completed an all-stock merger transaction with its social platform X. This transaction valued xAI at US$80 billion and social platform X at US$33 billion.
Musk said in May that he wanted to buy 1 million artificial intelligence chips. Most of the proceeds from this round will likely be used to build data centers equipped with Nvidia and AMD graphics processing units (GPUs), which are needed to develop the next generation of artificial intelligence, as well as to hire high-paying talent. The company is currently building a large artificial intelligence computer cluster in Memphis, Tennessee.
Separately, Tesla's board of directors asked investors earlier this month to approve a new Musk compensation package that could be worth as much as $975 billion. Musk said he does not support a merger between xAI and Tesla.