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Elon Musk’s AI startup X.AI Corp. is nearing a deal to raise $6 billion.
Sequoia Capital will participate in the deal along with other investors.
And it would value Musk’s AI startup at $18 billion.
Musk was an early co-founder of OpenAI, the company behind ChatGPT.
But he then walked away from the company.
This created some sort of beef between Musk and Sam Altman, OpenAI’s CEO.
And it led Musk to later launch his own AI firm called xAI.
xAI has been seeking investors for a while now.
It was reported a few weeks ago that the company had been in talks to raise three to four billion – as it seeks to crush rivals like OpenAI’s ChatGPT.
But xAI is now nearing a deal to raise $6 billion on a pre-money valuation of $18 billion, according to Bloomberg.
The deal is expected to close in the next few weeks unless the terms of the deal change.
xAI wants to be competitive with other large language models including OpenAI’s ChatGPT and Anthropic’s Claude.
OpenAI raised $13 billion from Microsoft (NASDAQ: MSFT). And Anthropic raised $6 billion from Amazon (NASDAQ: AMZN) andAlphabet (NASDAQ: GOOG).
Elon appears to be spending considerable amounts of time involved with this new AI startup.
xAI benefits from Elon’s ownership of Twitter.
The relationship allows xAI to use Twitter’s vast amounts of content for training its large language model. At the same time Twitter has not allowed its data to be used by ChatGPT and other chatbots.
AI startups are in a race for funding in order to secure talent and chips from Nvidia (NASDAQ: NVDA).
This funding round would help secure xAI as a serious contender among the chatbots.
So, what’s the best way to profit from Elon’s newest AI venture?
Ian Wyatt