Elon Musk's xAI wants $1B cash infusion in exchange for equity shares
What, spent all your liquid assets on Twitter, Elon?
The world's richest man is begging for cash again, this time he'd like $1 billion for his recently formed AI outfit, with individual investors told to offer at least $2 million for a slice of the equity pie.
In a filing yesterday with the US Securities and Exchange Commission (SEC), Elon Musk's xAI said it had already nabbed nearly $135 million from four investors, and had "binding and enforceable agreement[s]" in place for the remaining $865 million.
Sorry readers, if you were hoping to buy in it might already be too late. You may still have a chance, however, as the SEC said that it won't attest to the accuracy of the information in the filing. So, provided you have a spare $2 million lying around – the minimum investment xAI will accept – you could still buy into Musk's quest "to understand reality," as the billionaire said of xAI's goals when announcing its founding in July.
xAI has since launched its own AI chatbot – "Grok" – which the company describes as having "a bit of wit and … a rebellious streak, so please don't use it if you hate humor!"
Grok reportedly has real-time knowledge of the world via posts on X, formerly Twitter, and "will also answer spicy questions that are rejected by most other AI systems." Access to Grok is restricted to X Premium+ subscribers willing to fork over $16 a month for the privilege of joining the waitlist.
Musk has called Grok "based," (an online political slang term for those unfamiliar) and marketed it as a response to what he has called "woke AI" from other organizations like OpenAI. Being woke AI, Musk alleges, means being trained to lie.
xAI "is focused on sort of AGI," Musk said during Tesla's Q2 earnings call this year when asked if Tesla investors should be concerned that the new enterprise could be a distraction. "I think there will be some value that xAI brings to Tesla," Musk added.
Musk has previously professed worry over the dangers of artificial general intelligence - we suppose if he's the one controlling it he feels much safer.
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Whether investors in other AI outfits like OpenAI, which is still reeling from the chaos surrounding CEO Sam Altman's brief ouster, will turn to Musk's enterprise is unanswered. The reason for Altman's firing is still unclear, former OpenAI director and LinkedIn cofounder Reid Hoffman said yesterday, and rivals like Anthropic have seized the opportunity to point out how they differ and why they're a better option.
Musk, on the other hand, recently told X advertisers off in very certain terms after some pulled ads in the wake of his promotion of antisemitic content and ads served next to hate speech on his personal social media platform.
Whether AI investors will want to be associated with a company whose AI is trained largely on posts from X isn't immediately clear. The names of those who've already bought into xAI's equity round, and the alleged investors ready to bring the round to $1 billion, weren't included in the SEC filing, and xAI hasn't responded to questions from The Register. ®