Musk’s xAI Holdings is reportedly in talks to secure the second-largest private financing round ever for a startup.
Elon Musk’s xAI Holdings is in talks to raise $20 billion in new funding, which could value the AI and social media company at more than $120 billion, according to a new Bloomberg report that says the talks are still in the early stages.
If the deal goes through, it would be the second-largest funding round for a startup ever, surpassed only by the $40 billion raised by OpenAI last month. That operation was led by SoftBank. According to a Bloomberg report, OpenAI’s value rose to $300 billion as a result. OpenAI had previously expected to nearly triple its revenue to $12.7 billion by 2025.
Hefty monthly interest charges for X
The funding could help ease X’s significant debt burden, which according to Bloomberg sources costs the company $200 million in interest payments each month, with annual interest payments exceeding $1.3 billion at the end of last year.
A financing round of this size would also demonstrate the continued appeal of AI to investors, as well as Musk’s surprising emergence as a politically influential figure within President Trump’s White House.
Musk relies on loyal investors
Musk is likely to once again receive support from some of the same investors who previously invested in his ventures, from Tesla to SpaceX, including Antonio Gracias of Valor Equity Partners and Luke Nosek of Gigafund. Gracias has even taken on a role as lieutenant within Musk’s Department of Government Efficiency. xAI did not immediately respond to a request for comment.
In December, xAI raised $6 billion to further develop and expand the Colossus supercomputer environment. This supercomputer is expected to be operational by the end of 2025.