As it faces fierce competition in the artificial intelligence sector, billionaire tech tycoon Elon Musk’s business xAI said that it has raised $6 billion from investors in its most recent investment round.
xAI Chatbots
The company, whose main offering is the Grok chatbot, received backing from Saudi Arabian and Qatari investment groups, chipmakers NVIDIA and AMD, and US venture capitalists. Despite Musk’s constant warnings that AI is a threat to human civilisation, he is actively working to increase investment in the field, and in May, xAI raised $6 billion.
With an estimated $50 billion valuation, the business is already among the most valuable startups in the world, but it is still far smaller than its main rival, OpenAI, which is valued at an estimated $157 billion. Critics have noted that despite the exorbitant projections, AI companies are still losing money and lack a clear route to profitability.
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When xAI announced the fundraising on Monday, it stated that it would “ship groundbreaking products that will be used by billions of people” with the money. It would additionally “accelerate the research and development of future technologies enabling the company’s mission to understand the true nature of the universe” .
On his X account, Musk, who is also the CEO of SpaceX and Tesla and a major supporter of US President-elect Donald Trump, stated that “a lot of compute is needed” to power AI goods. Shortly after signing an open letter advocating for a halt to the development of potent AI models, he founded the business in July 2023.
Lawsuit against OpenAI
Musk is suing ChatGPT creator OpenAI, which he co-founded as a non-profit in 2015 before departing in 2018, claiming that the company’s transition to a for-profit business violates legally binding agreements.
According to the financial news site, the injunction was filed Friday by lawyers for the billionaire and his AI business, xAI. Additionally, the injunction asks that OpenAI cease allegedly preventing its investors from lending money to rival businesses. The action is the most recent chapter in a business dispute between Musk, who co-founded OpenAI in 2015 but has since departed, and the company. As OpenAI has emerged as a major force in the rapidly expanding field of artificial intelligence, its profile has soared in recent years.
Musk has claimed that OpenAI prevents its investors from funding competitors, which would harm his own business in a market with billions of dollars at stake. Originally established as a non-profit, OpenAI is now a “capped” for-profit company. In an attempt to draw in more capital, it is now working to become a for-profit public benefit corporation. Following his departure in 2018, Musk expressed his displeasure with the company’s profit-driven course under CEO Sam Altman’s leadership.
In March, he sued the corporation, claiming it had violated its initial non-profit goal of making AI research publicly accessible. Musk’s lawsuit and his support for open source AI development, according to OpenAI, are merely a case of bitter grapes after he left the firm.
