Elon Musk's xAI Set to Raise $20 Billion in Historic Funding Round
Elon Musk's AI startup, xAI, is set to raise a staggering $20 billion in funding. The round, which is one of the largest in tech history, includes up to $2 billion in equity investment from Nvidia, with the remaining $7.5 billion in equity and up to $12.5 billion in debt.
In September 2023, Elon Musk dismissed a CNBC report suggesting xAI had already raised $10 billion. However, he confirmed that future capital raising was indeed likely. Nvidia, whose market capitalization surpassed $1 trillion in 2023 due to interest in generative AI systems, declined to comment on the report. xAI plans to use the funds to purchase Nvidia's GPUs for its Colossus 2 data center. Notably, the special purpose vehicle financing xAI's Colossus 2 Data Center is Elon Musk himself.
The $20 billion target represents a significant increase from earlier speculation of a $10 billion funding round. With this substantial investment, xAI aims to bolster its AI capabilities and remain competitive in the rapidly evolving AI landscape.
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