Elon Musk’s artificial intelligence (AI) startup xAI is in talks to raise up to $6bn in funding, reported the Financial Times, citing sources.
The fundraising efforts have reached family offices in Hong Kong, despite the region’s increasing control by Beijing.
Sources told the publication suggest that Musk is aiming for a $20bn valuation for xAI, although the final figures are subject to ongoing negotiations and investor interest.
In addition to Hong Kong, Musk is said to have approached sovereign wealth funds in the Middle East and investors in Japan and South Korea.
Despite these efforts, Musk has publicly denied any fundraising activities for xAI, contradicting regulatory filings indicating capital raising efforts.
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Following the FT report, in a post on X, Musk said: “xAI is not raising capital and I have had no conversations with anyone in this regard.”
Emails seeking comments from Musk on the matter did not elicit a response.
xAI, based in Nevada, introduced its first product – a chatbot named Grok – in late 2023.
Grok, which leverages social media data from X, aims to provide more current responses than its rivals.
Morgan Stanley, which previously assisted Musk’s acquisition of X, is said to be coordinating the fundraising.
The investment bank also declined to comment on the report.
The US Securities and Exchange Commission filings from December reveal xAI’s intent to raise $1bn from equity investors.
This move comes as the AI sector sees significant investments, with OpenAI receiving approximately $13bn from Microsoft and other AI startups such as Anthropic and Cohere securing funding from tech giants and venture capital firms.
Musk, who parted ways with OpenAI in 2018, launched xAI in July last year, criticising competitors for censorship and inadequate safety measures in their AI products.