Elon Musk's xAI raises $6 billion to build even more powerful AI supercomputers — Nvidia, AMD contribute to funding round

Shutterstock image of Elon Musk
(Image credit: Shutterstock)

Elon Musk's xAI has raised $6 billion in its latest funding round, pushing its total capital raised to $12 billion at a valuation of $50 billion, reports TechCrunch. The round, which involved 97 investors, followed a doubling of xAI's valuation within six months and solidified the company's position as a growing competitor in the AI sector.

Major investors in this funding round include Nvidia, AMD, Andreessen Horowitz, Blackrock, Fidelity, Kingdom Holdings, and Sequoia Capital, among others. Only previous investors who backed Musk's earlier ventures, such as the Twitter acquisition, could participate. The minimum investment per participant was $77,593, but the identities of most investors remain undisclosed. The company plans to raise additional funds next year to sustain its growth as it seeks to challenge larger rivals in the generative AI market.

Anton Shilov
Contributing Writer

Anton Shilov is a contributing writer at Tom’s Hardware. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends.

  • Konomi
    They'd have no problem hitting funding goals if Elon just says he wants to play Crysis. I'm sure everyone would chip in to get him a GPU..
    Reply
  • AkroZ
    A valuation of $50 billions when you generate only $100 millions annualy, it's over valued.
    Reply
  • Sleepy_Hollowed
    Without considering the scam artist this guy has been shown to be (space x succeeding despite him aside), this is insanity.

    AI is a bubble, but his stuff is the worst of all, and even if it’s hardware only, Facebook has been doing custom hardware for at least a decade.
    Reply
  • hotaru251
    Kind of glad he is in TX now and won't put all this useless power consumption on the nations grid and can just stress TX's special grid more (sorry texans)

    Hope someone can figure out how much money every "ai" company spent whe nthe fade/bubble pops. Wanna see which company ends up biggest lost $.
    Reply
  • thisisaname
    Elon Musk spending other people's money not a new thing.
    Reply
  • SomeoneElse23
    I simply don't understand the bad feelings people have towards Elon.

    Nor how they don't hesitate to say bad things about him every chance they get.

    Merry Christmas all.
    Reply
  • bit_user
    hotaru251 said:
    Kind of glad he is in TX now and won't put all this useless power consumption on the nations grid and can just stress TX's special grid more
    So far, Colossus seems to be based in Tennessee:
    https://www.tomshardware.com/tech-industry/artificial-intelligence/elon-musks-massive-ai-data-center-gets-unlocked-xai-gets-approved-for-150mw-of-power-enabling-all-100-000-gpus-to-run-concurrentlyIf he wants to continue scaling, it obviously will need more locations. I've heard electricity can get very expensive, during Texas' summer heat waves, so that might be a reason for him not to build there.
    Reply
  • bit_user
    The article said:
    Major investors in this funding round include Nvidia, AMD
    It feels a little like extortion to strong-arm your hardware into investing. I'm not saying that's what he did, but you can imagine the conversation:
    "Hey guys, I'm looking for investment in my AI venture and sure would appreciate it if you could chip in. That way, maybe I could afford to buy (more) of your hardware (wink, wink)."
    With his recent surge in political clout, that'd make it all the more complicated for someone to turn him down.
    Reply
  • waltc3
    thisisaname said:
    Elon Musk spending other people's money not a new thing.
    They all spend other people's money, all of them, without exception. Musk is merely spending a lot less of other people's money than they are...;) I like that myself, because in tech, like in politics, he who spends the most money frequently loses the race. Quality matters far more than quantity. You have to have a certain quantity to attempt a business, but if the quality isn't there, then fogedaboudit...;)

    This whole enchilada seems more like an adolescent e-peen contest every day. A lot of that, I think, is because of the way it's publicized in the general and tech press. It's all so simple-minded these days. It's not about computers that think, reason, and judge, because those computers do not exist and never will. "AI" seems to me to be essentially a new face--a new spin--on search engine tech. It's what the copyright lawyers are hashing out right now, and Google is hoping to avoid with the FTC.

    Forget Skynet and complex computers that "become self-aware" one day. That's all investor dope designed to milk the pockets of the unwashed masses. What are the base requirements for becoming an AI investor? Four things strike me as essential:

    1) You really enjoyed the Terminator movies and Skynet "makes perfect sense".
    2) You see investing in Skynet, "AI," as "getting in on the ground floor of a great investment, like you did with Walmart."
    3) You have an adequate amount of disposable income you can safely risk.
    4) Greed rolls off of you in waves, and you regard it as an essential food source.

    Yes, I know, I'm cynical, but I'll wager I'm not alone...;)
    Reply
  • thisisaname
    waltc3 said:
    They all spend other people's money, all of them, without exception. Musk is merely spending a lot less of other people's money than they are...;) I like that myself, because in tech, like in politics, he who spends the most money frequently loses the race. Quality matters far more than quantity. You have to have a certain quantity to attempt a business, but if the quality isn't there, then fogedaboudit...;)

    This whole enchilada seems more like an adolescent e-peen contest every day. A lot of that, I think, is because of the way it's publicized in the general and tech press. It's all so simple-minded these days. It's not about computers that think, reason, and judge, because those computers do not exist and never will. "AI" seems to me to be essentially a new face--a new spin--on search engine tech. It's what the copyright lawyers are hashing out right now, and Google is hoping to avoid with the FTC.

    Forget Skynet and complex computers that "become self-aware" one day. That's all investor dope designed to milk the pockets of the unwashed masses. What are the base requirements for becoming an AI investor? Four things strike me as essential:

    1) You really enjoyed the Terminator movies and Skynet "makes perfect sense".
    2) You see investing in Skynet, "AI," as "getting in on the ground floor of a great investment, like you did with Walmart."
    3) You have an adequate amount of disposable income you can safely risk.
    4) Greed rolls off of you in waves, and you regard it as an essential food source.

    Yes, I know, I'm cynical, but I'll wager I'm not alone...;)

    The other side of point 3 is your broke and your putting it all on AI to save you, hight risk high reward strategy.
    Reply