Musk's xAI seeks $20B funding at a whopping $120B valuation

Musk's xAI seeks $20B funding at a whopping $120B valuation
26 Apr 2025

Elon Musk's xAI Holdings is in talks to raise as much as $20 billion. The money would fund his newly merged AI start-up and social media company.

The new company, born out of the merger of X (formerly Twitter) and Musk's AI venture xAI was announced last month.

The money could be used to pay down some of the debt Musk took when he bought Twitter for $44 billion in October 2022.

Potential funding could mark record-breaking milestone
Funding implications

If successful, this funding round could become the second-largest start-up funding round ever recorded.

The only larger one was OpenAI's $40 billion financing earlier this year, PitchBook reported.

The latest transaction would value xAI Holdings at over $120 billion.

xAI Holdings in early stages of funding discussions

Since the merger, Musk and his team have been testing the waters of investor interest in further financing for their combined venture.

The talks are still in the early stages, with plans to raise funds over the coming months.

The total amount to be raised could even go beyond $20 billion as no final decision has been taken yet on the total sum or terms.

Investors show enthusiasm for AI companies
Investor sentiment

The size of this new funding round emphasizes the increasing interest from investors in AI companies.

It also emphasizes Musk's position as a major business leader and political influencer.

Despite Tesla's ups and downs, the valuations of Musk's private companies keep on increasing.

For example, SpaceX, Musk's rocket company, became the most valuable start-up ever following a private deal last year that valued the firm at $350 billion.