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Business News/ Companies / People/  Elon Musk dismisses reports about AI company's $500 million funding as ‘fake news’
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Elon Musk dismisses reports about AI company's $500 million funding as ‘fake news’

Bloomberg had reported that xAI is in discussions for a valuation ranging between $15-20 billion and has secured $500 million in commitments, but Musk rejects these claims.

File image of billionaire Elon Musk at an event (AP Photo/Kirsty Wigglesworth, Pool)Premium
File image of billionaire Elon Musk at an event (AP Photo/Kirsty Wigglesworth, Pool)

Tech billionaire Elon Musk has dismissed reports on the $500 million worth of funding plans for his artificial intelligence start-up xAI through posts on social media site X (formerly known as Twitter).

Replying separately to two users on the site, Musk told one user the information was "simply not accurate" and called the original Bloomberg report "fake news" in reply to another.

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Contradictory Reports on Funding

Bloomberg had earlier reported that xAI is in discussions for a valuation ranging between $15-20 billion and that the start-up has purportedly secured $500 million in commitments from investors, aiming for a total of $1 billion. This was rejected as fake news by Musk.

It said discussions are underway, aiming for a tender offer valued between $500 million and $750 million, sources told the publication, adding that the potential share price could be approximately $95 each.

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While xAI has not issued an official statement, Bloomberg quoted sources about the ongoing talks. The company did not respond to queries, Reuters said.

Earlier in December too, Musk had denied fundraising for xAI, despite the start-up's filing with the United States securities regulator showing it plans to raise $1 billion via equity offering.

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The document also noted that xAI has already raised about $135, without disclosing the names of those investors.

Musk launched xAI in July 2023, positioning it as a response to concerns about AI efforts by Big Tech. Musk has consistently criticised major tech companies for perceived excessive censorship and inadequate safety measures in their AI initiatives.

His AI company aims to compete with top players in the industry, including Google, Microsoft, OpenAI and Anthropic. In November, Musk announced xAI's first language model, Grok, which is trained on data from X and has real-time access to the social media platform.

(With inputs from Bloomberg, and Reuters)

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Published: 21 Jan 2024, 08:45 AM IST
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