Elon Musk rejected a $500M investment in xAI amid valuation talks
Elon Musk has denied the veracity of reports that his artificial intelligence (AI) company xAI has raised $500 million from investors of its $1 billion goal.
Musk responded to the user's post on X (formerly Twitter), saying, “This is incorrect,” referring to the Bloomberg article.
According to sources cited by Bloomberg, xAI is in talks for a possible valuation of $15 billion to $20 billion in the coming weeks.
News: Elon Musk's artificial intelligence company xAI has raised $500 million in pledges from investors to $1 billion! pic.twitter.com/5mqfysFT79
— X News Daily (@xDaily) January 20, 2024
Musk and investors reportedly plan to hammer out terms in the coming weeks in ongoing discussions about the possibility of acquiring the computing power alongside or instead of xAI's equity stakes.
In the year In November 2023, Musk mentioned that equity investors in X will get a 25% ownership stake in xAI. This means that these investors will be encouraged to invest at least 25% of the money they invested in xAI into xAI, according to Bloomberg. For example, if you invest $10 billion in X, you are invited to invest $2.5 billion or more in xAI.
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In the year In 2023, Musk launched xAI as an alternative to OpenAI, with which he had philosophical disagreements. xAI's chatbot, Grok, is powered by social media content X.
AI modeler xAI has confirmed that it has secured $865.3 million in private sale contracts for unregistered equity securities, according to a filing with the United States Securities and Exchange Commission on December 5, 2023.
The xAI Form D states that the securities will be sold to accredited investors subject to resale restrictions pursuant to Rule 506(b). The indenture sold $134.7 million of securities, with the initial sale scheduled for November 29, 2023.
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