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Sequoia Capital, Silicon Valley's best-known enterprise capital firm, has committed to investing in Elon Musk's artificial intelligence startup xAI, bolstering the Tesla boss's efforts to lift billions and tackle the likes of OpenAI, Meta and Google.
Musk has been trying for months to lift as much as $6 billion from investors worldwide for xAI, which he launched in 2023 with a mission to “understand the true nature of the universe.”
The serial entrepreneur has reached out to investors about his acquisition of the social media platform Twitter in 2022, which he’s within the know.
Sequoia, which invested $800 million in Twitter, can even put money into xAI, in accordance with the people. It is unclear how much the investment can be.
The Silicon Valley company, an early investor in Google, YouTube and Apple, has backed several Musk projects in recent times, including his tunneling company The Boring Company and industrial space company SpaceX. Roelof Botha, the top of Sequoia, was hired by Musk at PayPal in 2000.
Sequoia declined to comment.
Sequoia's backing, first reported by The Information, will give Musk a lift as he tries to meet up with rival AI startups like ChatGPT developer OpenAI and Anthropic, in addition to big tech corporations like Meta and Google. who’ve developed probably the most powerful leading large language models that underlie latest AI tools.
Building and operating LLMs is a costly affair. Huge amounts of computing power and expensive hardware are required to coach and run the models that power chatbots, which might generate lines of text, code and pictures in seconds.
OpenAI has raised $13 billion from its biggest backer, Microsoft, while Anthropic has received commitments of $2 billion and $4 billion from Google and Amazon, respectively.
Musk has steadily accrued the powerful chips needed to coach AI models and has hired engineers and researchers, some from Tesla, to support xAI. The capital investment would help speed up this project and convey xAI's chatbot, Grok, closer to the performance of its competitors.
Musk founded OpenAI in 2015 with the corporate's CEO Sam Altman and others. He left OpenAI's board in 2018 after disagreements with Altman over the direction of research.
Last month, Musk sued OpenAI and Altman, saying they’d compromised the startup's original mission to develop AI systems for the good thing about humanity. OpenAI has described the case as “frivolous.”
