Elon Musks artificial intelligence (AI) startup xAI is reportedly close to raising $6 billion from investors.

The funding round would value xAI at $18 billion, Bloomberg reported Friday (April 26).

Silicon Valley venture capital (VC) firm Sequoia Capital has committed to investing in the startup, according to the Financial Times (FT), which reported the same figures as Bloomberg.

Musk has also approached other investors who, like Sequoia Capital, participated in his 2022 acquisition of Twitter, which he later renamed X, the FT reported.

Musk announced the launch of xAI in July 2023 after hinting for months that he wanted to build an alternative to OpenAIs AI-powered chatbot, ChatGPT. He was involved in the creation of OpenAI but left its board in 2018 and has been increasingly critical of the company and cautious about developments around AI in general.

Two days later, during a Twitter Spaces introduction of xAI to the public, Musk said that while he sees the firm in direct competition with larger businesses like OpenAI, Microsoft, Alphabet and Meta, as well as upstarts like Anthropic, his firm is taking a different approach to establishing its foundation model.

AGI [artificial general intelligence] being brute forced is not succeeding, Musk said, adding that while xAI is not trying to solve AGI on a laptop, [and] there will be heavy compute, his team will have free reign to explore ideas other than scaling up the foundational models data parameters.

In November 2023, xAI rolled out its AI model called Grok, saying on its website: Grok is designed to answer questions with a bit of wit and has a rebellious streak, so please dont use it if you hate humor!

The company added that Grok has a real-time knowledge of the world thanks to the Musk-owned social media platform X; will answer spicy questions that are rejected by most of the other AI systems; and upon its launch had capabilities rivaling those of Metas LLaMA 2 AI model and OpenAIs GPT-3.5.

In March, xAI unveiled its open-source AI model. Musk said at the time: We are releasing the base model weights and network architecture of Grok-1, our large language model. Grok-1 is a 314 billion parameter Mixture-of-Experts model trained from scratch by xAI.

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Elon Musk's xAI Close to Raising $6 Billion - PYMNTS.com