Elon Musk’s xAI Corp. is reportedly in talks with investors to raise additional funding on a $40 billion valuation, some five months after the company had previously raised $6 billion on a $24 billion valuation. The Wall Street Journal, citing people familiar with the matter, claims that xAI is looking to raise several billion dollars in the new funding round. The Journal does note, however, that the talks are in their early stages, meaning that terms could change or the talks could fall apart. Launched by Musk in 2023, xAI is aiming to develop an advanced artificial general intelligence system that surpasses current AI capabilities. The company is focused on building a safe, robust AGI that is driven by Musk’s vision of creating beneficial and human-aligned intelligence. The company released its first large language model – Grok-1, late in 2023 before releasing Grok-1.5 in April and Grok-2 in August. The latest Grok-2 model can generate text, troubleshoot code, perform related tasks and analyze user-provided images. At the time of its release, xAI claimed that based on an evaluation comprising eight benchmark datasets that researchers commonly use to measure an LLMs’ accuracy, Grok-2 achieved “performance levels competitive” with the most advanced LLMs on the market. Notable, on one test called GPQA, Grok-2 achieved higher scores than OpenAI’s GPT-4o and Meta’s Llama3 405B model, an impressive outcome for a relatively young AI company. Building advanced AI models requires training and processing power, with the latter being why, five months after raising $6 billion, xAI is seeking yet more funding. And the previous funding has, in large part, gone towards bringing online more processing power. In September, xAI announced that it had completed the assembly of an artificial intelligence training system that features 100,000 graphics cards. Called “Colossus,” the system is claimed by Musk to be the “most powerful AI training system in the world” and runs on 100,000 Nvidia Corp. H100 graphics cards. While it is likely that Musk and xAI will be getting discounted rates on their bulk buys, the Nvidia H100GPU generally sells for around $30,000 to $40,000 each, putting the cost for the GPUs for Colossus before data center construction and running costs at around $3 billion give or take. Add to the mix that 100,000 H100s would also use approximately 35 megawatts of power, roughly the equivalent of the energy needed to power a small town, and the cost continues to spiral. For xAI, that’s also just the start, with Musk announcing earlier this week that xAI plans to double its Colossus data center from 100,000 H100 GPUs to 200,000. The news that xAI is in talks to raise more funding comes as its competitors continue to either raise funds or hold discussions to do so – after all, building cutting-edge AI models doesn’t come cheaply. Recent AI-related funding news includes OpenAI raising $6.6 billion on a $157 billion valuation on Oct. 2, while Anthropic PBC was reportedly in talks to raise new funding on a $40 billion valuation in September. Image: SiliconANGLE/Ideogram A message from John Furrier, co-founder of SiliconANGLE: Your vote of support is important to us and it helps us keep the content FREE. One click below supports our mission to provide free, deep, and relevant content. Join the community that includes more than 15,000 #CubeAlumni experts, including Amazon.com CEO Andy Jassy, Dell Technologies founder and CEO Michael Dell, Intel CEO Pat Gelsinger, and many more luminaries and experts. “TheCUBE is an important partner to the industry. You guys really are a part of our events and we really appreciate you coming and I know people appreciate the content you create as well” – Andy Jassy THANK YOU {Categories} _Category: Takes{/Categories} {URL}https://siliconangle.com/2024/10/29/elon-musks-xai-reportedly-talks-raise-new-funding-40b-valuation/{/URL} {Author}Duncan Riley{/Author} {Image}https://d15shllkswkct0.cloudfront.net/wp-content/blogs.dir/1/files/2024/10/xaidatacenter.png{/Image} {Keywords}AI,NEWS,Anthropic,Elon Musk,funding,Grok-2,H100,Nvidia,OpenAI,venture capital,XAI{/Keywords} {Source}POV{/Source} {Thumb}https://d15shllkswkct0.cloudfront.net/wp-content/blogs.dir/1/files/2024/10/xaidatacenter.png{/Thumb}