Elon Musk's xAI has raised $6 billion in its latest funding round, bringing its total capital to $12 billion with a $50 billion valuation, according to TechCrunch. This round, involving 97 investors, follows a doubling of xAI's valuation in six months, bolstering its status as a significant player in the AI sector. Key investors in this round include Nvidia, AMD, Andreessen Horowitz, BlackRock, Fidelity, Kingdom Holdings, and Sequoia Capital. Only prior investors involved in Musk's ventures, like the Twitter acquisition, were allowed to join. The minimum investment was $77, 593, but most investors' identities remain undisclosed. The company plans to seek more funds next year to continue challenging major players in the generative AI field. xAI has developed the Colossus supercomputer, powered by 100, 000 Nvidia H100 GPUs, and plans to expand to 200, 000 Nvidia GPUs soon, eventually aiming for one million GPUs. For reference, $6 billion could buy a supercomputer with servers containing 100, 000 Nvidia GPUs at $30, 000 each, with GPUs typically comprising half of a supercomputer's cost.

Enhanced supercomputers will allow xAI to develop advanced large language models to compete with OpenAI's ChatGPT and Google's Gemini. Musk has positioned xAI to rival industry giants like OpenAI, criticizing OpenAI and Microsoft for anti-competitive tactics that block funding for alternatives. He also claims xAI benefits from data from X and that recent X policy changes let xAI use user-generated content for training its models. Additionally, xAI draws data from Musk's other companies, Tesla and SpaceX, to refine its AI models. xAI has advanced its technology with its flagship AI model, Grok, which powers tools on X, such as a chatbot for X Premium users and image generator Flux. Unlike OpenAI, Grok handles provocative questions but maintains boundaries on sensitive issues. Grok currently supports SpaceX's Starlink customer service, and xAI is looking into collaborations with Tesla for R&D. However, some Tesla shareholders are wary, accusing Musk of diverting resources from Tesla to xAI and seeing the companies as competitors. xAI generates about $100 million annually, lagging behind Anthropic and OpenAI, who aim for billions in revenue and have secured more funding. AI venture capital reached $31 billion in Q3 2024, and xAI aims to expand its market share as it accelerates its development.