Elon Musk’s artificial intelligence venture, xAI, is on the verge of securing up to $6 billion, positioning the company at a staggering $50 billion valuation.
Insider sources reveal that this funding round, anticipated to finalize early next week, will include approximately $5 billion from sovereign funds in the Middle East, alongside $1 billion from various investors, some of whom might be looking to increase their stakes.
The infusion of capital will primarily be allocated towards the acquisition of 100,000 Nvidia chips, as reported by individuals familiar with the matter. Notably, Tesla’s Full Self-Driving technology is set to leverage the innovative capabilities of the forthcoming Memphis supercomputer.
It is no secret that Elon has since been trying to secure his own share of the AI pie and has decided to delve head first in off the deep end with his purchase from Nvidia.
News of this impending purchase has sent the stock market into a frenzy as potential investors begin to try and swoop in on Nvidia’s stock, as that potential $6 billion could be seen as a massive windfall for the company.
Musk’s AI startup, unveiled in July 2023, aims to “uncover the true essence of the universe,” as stated on its website. In November, xAI introduced Grok, a chatbot inspired by “The Hitchhiker’s Guide to the Galaxy.” The company reported that Grok was launched after two months of training and boasted real-time internet knowledge.
However, the real star of the show is the Memphis data center where all of these chips would be sent to. Situated in Memphis, Tennessee, birthplace of the king of rock and roll, this state-of-the art data centre is expected to house the majority of Elon’s new Nvidia chips, with the expectation that a few may be shared around his other companies to boost productivity and allow for more computational and mathematical models.
Tesla and SpaceX stand to be the biggest benefactors of the spillover from Musk, as both companies will always be in need of more hardware and power to keep designing the future they want to see.
The majority of the work expected to be done will be carried out at the Memphis data facility where Tesla may utilize Grok to revolutionise its self-driving fleet of robotaxis.
Buoyed by his new standing within the Trup administration and seeing all of his share prices skyrocket, the World’s Richest man may be throwing another business master stroke that could one day disrupt the AI industry; however, that still remains to be seen, but based on Elon’s bold betting track record, the numbers may be in his favour.
Source: CNBC
