Home CryptocurrencyAltcoin Elon Musk denies $500M investment in xAI amid valuation talks

Elon Musk denies $500M investment in xAI amid valuation talks

by SuperiorInvest

Elon Musk has denied the accuracy of a report claiming his artificial intelligence (AI) company, xAI, raised $500 million of a $1 billion target from investors.

Musk answered to a user’s post on X (formerly Twitter), saying, “This is not accurate,” referring to a Bloomberg article.

According to sources cited by Bloomberg, xAI is in talks about a valuation ranging between $15 billion and $20 billion, with possible adjustments in the coming weeks.

Musk and investors reportedly plan to reach a deal in the coming weeks, with discussions ongoing about the possibility of obtaining computing power alongside or instead of xAI stock.

In November 2023, Musk mentioned that investors in X would get a 25% stake in xAI. This implies that these investors are encouraged to invest at least 25% of the amount they invested in X in xAI, according to Bloomberg. For example, if they invested $10 billion in X, they are invited to invest $2.5 billion or more in xAI.

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In 2023, Musk started xAI as an alternative to OpenAI, where he had philosophical disagreements. xAI’s chatbot Grok is powered by X’s social media content.

AI modeler xAI secured a deal for the private sale of $865.3 million in unregistered equity securities, according to a filing with the U.S. Securities and Exchange Commission on Dec. 5, 2023.

Form D xAI specified that the securities would be sold to accredited investors, subject to resale restrictions under Rule 506(b). The filing notes that $134.7 million in securities have already been sold, with the initial sale occurring on November 29, 2023.

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