home AI News X.AI, Elon Musk's AI Startup, Files for $1 Billion Equity Offering

X.AI, Elon Musk's AI Startup, Files for $1 Billion Equity Offering

Ava Jones

Updated on Dec 07, 2023

pen AI News
X.AI, an artificial intelligence (AI) startup founded by Elon Musk, has recently filed with the Securities and Exchange Commission (SEC) to raise up to $1 billion in an equity offering. The company has already secured approximately $135 million from four investors, with the first sale taking place on Nov. 29. The filing indicates a "binding and enforceable agreement" for the acquisition of the remaining shares.

The primary goal of X.AI, as outlined on its website, is to "understand the true nature of the universe". Musk announced the AI startup in July, and it has since made significant strides in its mission. In a recent development, X.AI launched a chatbot named Grok, inspired by "The Hitchhiker's Guide to the Galaxy". Grok boasts real-time knowledge of the internet and is designed to answer questions with wit, humor, and a rebellious streak.

the hitchhikers guide to the galaxy

X.AI is positioning Grok to compete directly with established entities such as OpenAI, the creator of ChatGPT, in which Musk played a role before leaving in 2018 due to a conflict with co-founder Sam Altman. Other competitors in the AI chatbot space include Google's Bard technology and Anthropic's Claude chatbot.

Elon Musk, also known for his roles in Tesla, SpaceX, Twitter, the Boring Company, and Neuralink, secured thousands of high-powered graphics processing units (GPUs) from Nvidia earlier this year. These GPUs are crucial for building large language models, a technology that Musk seems keen on exploring with X.AI.

In terms of ownership, Musk stated last month that investors in X (formerly Twitter) would possess 25% of X.AI. The company emphasizes its independence from X Corp but notes collaboration with Twitter, Tesla, and other Musk-led ventures to advance its mission.

X.AI has assembled a team of experts with backgrounds in companies such as DeepMind, OpenAI, Google Research, Microsoft Research, Twitter, and Tesla. Their collective experience includes contributions to projects like DeepMind's AlphaCode and OpenAI's GPT-3.5 and GPT-4 chatbots.

Musk incorporated X.AI in Nevada in March, as revealed by official filings. Addressing concerns about potential competition with Tesla, Musk clarified on a Tesla earnings call in July that X.AI emerged from a desire to attract top-tier AI talent to a startup environment, where they could contribute to cutting-edge developments.

The financing activities of X.AI coincided with Musk's appearance at the 2023 DealBook Summit. During the summit, Musk addressed advertisers who had suspended campaigns on X.AI, delivering a blunt message. Dozens of advertisers had halted spending on the platform following Musk's posts and amplification of antisemitic comments.

As X.AI continues its fundraising efforts and the development of Grok, the startup remains a significant player in the AI landscape, with Elon Musk at the helm, steering it toward a profound understanding of the universe.

Ava Jones Senior Editor

Ava Jones is a dedicated journalist covering the latest developments in the AI world. Her passion for AI news is evident in her wide-ranging coverage, which spans various topics and explores cutting-edge advancements. Ava's work expands AI knowledge and keeps readers informed about industry trends.