Musk’s Track Record, OpenAI Success Are Focus Of Potential xAI Investors
Potential investors in Elon Musk’s new artificial intelligence startup, xAI, are focusing on two key selling points: access to the billionaire’s constellation of companies — referred to as the “Muskonomy” — and the early success of one of its biggest competitors, OpenAI.
(Bloomberg) -- Potential investors in Elon Musk’s new artificial intelligence startup, xAI, are focusing on two key selling points: access to the billionaire’s constellation of companies — referred to as the “Muskonomy” — and the early success of one of its biggest competitors, OpenAI.
Musk’s track record and OpenAI feature prominently in a slide deck circulating among potential xAI investors in December and January, according to copies reviewed by Bloomberg. The presentation includes a slide showcasing the “key attributes that drove OpenAI’s success,” such as strategic partnerships and access to capital, and a side-by-side comparison showing xAI’s similarities.
Another slide features graphs depicting OpenAI’s rapid user growth and projected revenue increases, and includes the line “OpenAI provides line of sight to xAI’s potential trajectory.” Musk didn’t respond to requests for comment.
The deck also highlights Musk, the world’s richest person, and his history as an entrepreneur, with many of his other companies touted throughout the presentation. Social network X, formerly Twitter, and electric-vehicle maker Tesla Inc. are both listed in the deck as strategic partners for xAI, and named as sources of training data for developing its technology. One slide shows that Musk has raised billions of dollars across all his companies — the “Muskonomy,” as it’s called in the deck — as a way to offer evidence that Musk will be able to do the same with xAI.
“XAI is led by a world-class entrepreneur in Musk with a demonstrated track record of building large cap market leaders, especially with deep tech/new frontier businesses that demand significant engineering expertise,” the presentation reads.
Musk launched the startup last year as an alternative to OpenAI, which he co-founded and later left over philosophical differences about how to profit from the technology. XAI has secured at least $500 million in financing with a goal of reaching $1 billion in total equity, Bloomberg reported in January, and at the time was discussing a valuation of $15 billion to $20 billion.
Founded in March 2023, xAI still has roughly 20 employees, according to the deck, several of whom are veterans of Google’s DeepMind and parent company Alphabet Inc., another rival entrant in the race for AI innovation.
The fledgling company has just one commercial product so far, a chatbot assistant named Grok that is available only to paying subscribers on X. The startup has positioned Grok as an edgier alternative to OpenAI’s ChatGPT and other offerings, and announced at launch that it will “answer spicy questions that are rejected by most other AI systems.”
Grok is being trained using data collected by X — a marketing point for xAI, which says that will make its chatbot more up to date on new information.
Read More: Microsoft, Amazon and Google Are Kingmakers for AI Startups
More stories like this are available on bloomberg.com
©2024 Bloomberg L.P.
