According to 'Financial Times', Elon Musk is starting talks on different fronts to raise financing for xAI, his artificial intelligence startup.
Among many businesses that involve Elon Musk , xAI is one of the most incipient. The artificial intelligence startup is less than a year old , but it has already launched its first product: Grok , the chatbot integrated into X (Twitter). And everything indicates that the businessman has begun to talk with potential investors to expand the company's financing.
According to the Financial Times , Elon Musk has entered talks to raise $6 billion for xAI, at a proposed valuation of $20 billion. With this capital, the firm would aspire to establish itself more strongly as a competitor of OpenAI, the main reference in the artificial intelligence sector.
Although the information is unofficial, the leader of Tesla, SpaceX and X (Twitter) would analyze several alternatives. On the one hand, an apparent rapprochement with Hong Kong is mentioned ; specifically, to some family offices based there. It is worth clarifying that a family office is a private company that manages the investment portfolio of wealthy families, with fortunes that are generally above $100 million.
Elon Musk, seeking financing for xAI
On the other hand, Elon Musk would also be probing the interest of some Middle Eastern sovereign funds , although it is not mentioned precisely which ones. In any case, the tycoon already has to some extent some type of relationship with the two most important—and controversial—. We are talking, of course, about those from Saudi Arabia and Qatar.
Let us remember that Saudi Prince Alwaleed bin Talal, through the company Kingdom Holding Company (KHC), was a shareholder in Twitter before the social network was purchased by Elon Musk. As you can imagine, part of KHC belongs to the Public Investment Fund (PIF), the Saudi sovereign fund. Meanwhile, when the businessman sought financing to close the purchase of Twitter, Qatar Holding LLC , a subsidiary of Qatar Investment Authority , the Qatari investment fund, was included in the list of investors .
Considering that these sovereign funds have shown increasing interference in the technology sector—especially in video games and telecommunications—it would not be surprising if xAI is presented as an attractive option. In any case, we will have to wait to know if they are really involved in any type of negotiation or conversation about it.
Beyond the apparent approach to wealthy families in Hong Kong and sovereign funds in the Middle East, Elon Musk would seek financing in other sectors in Asia. According to the Financial Times , investors from South Korea and Japan would also have been contacted to approach xAI's proposal. However, no further details are provided.
The aforementioned media indicates that the coordination of the capital search is in charge of Morgan Stanley . Again, it would not be surprising if this turned out to be true, since this institution was one of those that financed the purchase of Twitter in 2022.
Will fresh capital arrive from Asia?
Beyond Grok, the X chatbot that, according to Elon Musk, is an untethered ChatGPT, little is known about xAI projects. The startup has recruited engineers and researchers with experience in the field of artificial intelligence. Mostly from OpenAI, Google Research and Deepmind, Tesla, Microsoft Research and the University of Toronto.
The $6 billion in financing that Elon Musk is pursuing is likely to seek to expand the company's human and technological capabilities. Especially, knowing that the development of massive language models (and the applications that take advantage of them) is very expensive . Furthermore, OpenAI, the main reference in the sector, not only has the technical advantage, but also has the endorsement of Microsoft and its robust checkbook.
It will be interesting to see if the search for financing in Asia, especially in Hong Kong and the Middle East, does not set off some alarm bells in the United States. China's growing interference in Hong Kong territory is a cause of concern in the White House, and everything related to the development and investment in artificial intelligence has been causing short circuits between the Americans and the Asian giant for some time . The ban on the export of the most advanced GPUs from NVIDIA and AMD to China is clear proof of this. We will follow the matter closely.
