Elon Musk’s artificial intelligence firm xAI is reportedly in talks to raise $4.3 billion in a new equity investment round.
The company behind snarky AI chatbot Grok has told investors that it needs the money in part because it has burned through cash it had previously raised, Bloomberg reported, citing materials it had obtained that were shared with potential investors.
xAI is pursuing the equity investment in addition to its plans to borrow $5 billion from debt investors, the report added. Morgan Stanley is leading the debt sale, with commitments from participants due by Tuesday.
The debt sale reportedly hit a snag after Musk’s very public war of words with President Trump.
However, xAI has made concessions to entice investors that may have been spooked by the feud between the former DOGE cost-cutter and Trump — such as placing a limit on the amount of secured debt it can raise, according to Bloomberg.
While Musk recently moved to merge xAI with his social media platform X, formerly known as Twitter, the new funds will go toward AI operations, the report said.
Representatives for xAI did not immediately return The Post’s request for comment.
The AI startup had raised $14 billion in equity fundraising since its launch in 2023, according to Bloomberg.
However, xAI was said to be down to $4 billion as of March 31.
The company raised $6 billion from investors as recently as December.
The mogul’s company is locked in intense competition with well-funded rivals like Sam Altman’s OpenAI, Mark Zuckerberg’s Meta and Sundar Pichai’s Google to win the race to develop advanced AI.
All of the firms have poured tens of billions of dollars into efforts to build out the AI data centers and other infrastructure required to train and power the large-language models that underpin their AI products.
XAI has told investors that it has an $80 billion valuation as of the first quarter of this year – up from $51 billion at the end of last year.
With Post wires
