Driven by investor frenzy over Nvidia chips, Musk’s xAI approaches a $20 billion capital raise.
Elon Musk’s artificial intelligence startup, xAI, is raising significantly more funding than initially planned, with Nvidia investing up to US$2 billion in equity, as reported by Bloomberg News onTuesday, citing people familiar with the matter.
The new financing round, totaling about US$20 billion (HK$156 billion), includes both equity and debt components and is linked to the Nvidia GPUs that xAI intends to deploy in its upcoming data center, Colossus 2.
According to the report, xAI’s fundraising will comprise around US$7.5 billion in equity and up to US$12.5 billion in debt, structured through a special purpose vehicle that will facilitate the purchase of Nvidia processors. Nvidia declined to comment on the matter, while xAI did not immediately respond to requests for comment.
The latest development comes after Musk denied a CNBC report in September suggesting that xAI was raising US$10 billion at a valuation of US$200 billion. At the time, Musk said the company would raise capital “in the coming months, just not right now.”
Nvidia declined to comment, while xAI did not immediately respond to a request for comment, as reported by Bloomberg.
Founded in July 2023, xAI positions itself as a rival to OpenAI’s ChatGPT, with ambitions to advance safe and transparent artificial intelligence systems.
