Musk’s xAI lands $20 bn as AI race intensifies
Startup eyes gigawatt-scale data centres, 5.5 lakh Nvidia chips
image for illustrative purpose
New Delhi: Tesla and SpaceX CEO Elon Musk’s artificial intelligence startup, xAI, has announced the completion of a $20 billion funding round from investors including Nvidia, Valor Equity Partners and the Qatar Investment Authority.
The company did not disclose individual investment amounts or the split between debt and equity, and named Stepstone Group, Fidelity Management & Research, MGX, Baron Capital Group and Cisco Systems Inc.’s investment group among other investors who participated in the funding.
xAI had planned for roughly $7.5 billion of equity and up to $12.5 billion of debt parked in a special purpose vehicle to buy Nvidia processors. The chips would be rented out for five years, allowing financiers to recoup their investment, according to reports.
The AI startup said the financing will accelerate its infrastructure buildout, speed development and deployment of AI products to billions of users, and fuel research advancing its mission of “understanding the universe”.
The firm, which had already raised about $10 billion of corporate equity and debt in 2025, has been burning through about $1 billion per month, the reports said citing sources. Musk had eralier confirmed that xAI is expanding data centre capacity in Memphis toward almost 2 gigawatts.
