Elon Musk's AI company, xAI, has raised $10 billion from investors that puts the company's post-money valuation at $200 billion, sources told CNBC's David Faber.
The valuation for Musk's AI company is the latest example of skyrocketing valuations for companies that develop foundational AI models. Earlier this month, Anthropic raised $13 billion at a $183 billion valuation. OpenAI, the largest company in the industry, held a secondary share sale that valued it at $500 billion.
The fundraising comes weeks after Musk raised $10 billion in debt and equity at what was believed to be a roughly $150 billion valuation, according to Faber. Last December, xAI raised $6 billion to fund its artificial intelligence development.
However, xAI's Grok service is widely believed to lag behind Anthropic's Claude and OpenAI's GPT models in terms of capabilities and number of users.
Musk said in May that he wants to buy a million AI chips, Faber said. Much of the proceeds of this round of funding could go to building data centers filled with Nvidia and AMD AI chips called GPUs that are needed to develop next-generation AI, as well as to hire expensive talent. The company is currently building a large cluster of AI computers in Memphis, Tennessee.
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