AI Startup xAI Secures $6 Billion in Funding Round, Eyes Alternative to OpenAI with Elon Musk’s Resignation

In a blog post on Sunday, an AI startup announced that they had successfully raised $6 billion in their Series B funding round. This influx of funding will be crucial for the company as they aim to become an alternative to OpenAI, a company co-founded by Elon Musk with which he resigned from the board in 2018.

Musk further added in a post on Monday that there will be more announcements to come in the following weeks. He also shared that xAI’s pre-money valuation was $18 billion. This marks the first time that xAI has publicly discussed their fundraising efforts, as previous reports from outlets such as Bloomberg and the Financial Times about the company reaching out to potential investors were denied by Musk.

The ChatGPT maker was previously valued at over $80 billion following a deal that allowed staff to cash out their shares, as reported by The New York Times in February. However, Musk filed a lawsuit against OpenAI that same month, accusing the company of straying from its nonprofit mission by forming a partnership with Microsoft. A year ago, Musk expressed his disappointment in the direction OpenAI had taken, claiming that it had become a closed-source profit-driven company, which was the opposite of his original intentions.