X.AI, the artificial intelligence startup founded by tech mogul Elon Musk, has recently filed with the Securities and Exchange Commission (SEC) to initiate an equity offering with the aim of raising up to $1 billion. The company has already secured an impressive $135 million from four investors, with the initial sale taking place on November 29. Notably, a binding and enforceable agreement is in place for the acquisition of the remaining shares.
The vision behind X.AI, as articulated on its website by Musk when he announced the venture in July, is to “understand the true nature of the universe”. In a significant move in November 2023, X.AI unveiled its latest creation, a chatbot named Grok. The company boasts that Grok, inspired by "The Hitchhiker’s Guide to the Galaxy," comes equipped with two months of intensive training and possesses real-time knowledge of the internet.
“Grok is designed to answer questions with a bit of wit and has a rebellious streak, so please don’t use it if you hate humor!” X.AI website further added, “It will also answer spicy questions that are rejected by most other AI systems.” With Grok, X.AI is entering the competitive arena, directly challenging other players in the field, including OpenAI (creator of ChatGPT), Google's Bard technology, and Anthropic's Claude chatbot.
Notably, Musk had reportedly secured thousands of high-powered graphics processing units (GPUs) from Nvidia earlier, an essential component for building large language models like those employed by AI systems.
X.AI is just one among Musk's diverse portfolio of companies. Apart from leading X.AI, he also holds the position of CEO at Tesla and SpaceX. His other ventures include the Boring Company, focused on underground tunnel development, and Neuralink, a brain-tech startup.
Further, Musk emphasized the genesis of X.AI during a Tesla earnings call in July, highlighting that the company was formed to attract some of the world's top AI engineers and scientists who were more inclined to join a startup than an established company like Tesla. The incorporation of X.AI in Nevada took place in March, and he expressed his commitment to working closely with X (formerly Twitter), Tesla, and other entities to advance their shared mission.
The team at X.AI comprises professionals with diverse backgrounds, including alumni from renowned entities such as DeepMind, OpenAI, Google Research, Microsoft Research, Twitter, and Tesla. Their collective experience encompasses projects like DeepMind's AlphaCode and OpenAI's GPT-3.5 and GPT-4 chatbots.
In a recent statement, Musk mentioned that investors in X.AI would own a substantial 25% of the company, reinforcing the collaborative nature of his ventures. As X.AI progresses with its financing, the strategic timing of the initial sale aligns with his appearance at the 2023 DealBook Summit, indicating a calculated approach to its fundraising efforts.