xAI Raises $6 Billion in Funding Round
Elon Musk’s xAI, a competitor to OpenAI, is on the brink of securing a massive $6 billion investment round, with a pre-money valuation of $18 billion, according to insider sources familiar with the deal. This funding round, expected to close in the coming weeks, will allocate investors approximately one-quarter ownership stake in the company.
Adjustments in Deal Terms
Initially targeting a $3 billion raise with a $15 billion pre-money valuation, xAI quickly adjusted its terms in response to overwhelming investor interest. Jared Birchall, leading Musk’s family office, informed prospective investors about the updated terms via email, citing high demand for participation in the deal.
Participation of Major Investors
Venture capital heavyweights Sequoia Capital and Future Ventures, co-founded by Musk’s longtime associate Steve Jurvetson, are among the prominent investors participating in the funding round. Additionally, it is expected that Valor Equity Partners and Gigafund, both closely associated with Musk, will contribute to the investment.
Notable Figures in xAI’s Investor Base
Steve Jurvetson, a board member at SpaceX and former Tesla director, holds a significant role in Future Ventures and is involved in the investment round. Luke Nosek, co-founder of Gigafund and a SpaceX board member, is known for his early investment in SpaceX and Tesla. Antonio Gracias, founder of Valor Equity Partners and an early Tesla investor, also brings substantial expertise to the deal.
Unique Investor Gathering Process
The process of securing commitments for the investment round has been described as exclusive, with Elon Musk, Jared Birchall, and engineering team members holding intimate Zoom meetings with individual investors. This approach has led to some uncertainty among investors regarding the full roster of participants in the deal.