SpaceX will invest $2 billion in Elon Musk’s xAI

Elon Musk’s company SpaceX may invest 2 billion dollars in xAI – a startup in the field of artificial intelligence, also founded by Musk. This is reported by the Wall Street Journal, citing sources close to SpaceX. The investment is expected to be part of a broader $5 billion capital raising round organized by Morgan Stanley, plus $5 billion in debt financing.

This will be SpaceX’s first major involvement in funding another company, and at once at the level of a strategic partnership. As the WSJ notes, xAI is already working with SpaceX: xAI’s chatbot Grok is used to support Starlink satellite internet users, and the partnership could expand in the future.

Musk has previously merged his assets, for example by integrating xAI with social network X (formerly Twitter), where Grok became part of a premium subscription. Grok is now being actively embedded into Musk’s other businesses, including Tesla, despite heavy criticism after the publication of anti-Semitic posts where the bot referred to itself as “MechaHitler,” among other things. The xAI team publicly apologized but declined to radically overhaul the model’s architecture.

The planned deal with SpaceX confirms Musk’s strategy of internal synergies between his companies – from rockets and electric cars to AI and social networks. At the same time, such moves have raised concerns among analysts about possible conflicts of interest and increased monopolization of AI resources.

According to recent reports, xAI is valued by investors at more than $24 billion. The company is developing an alternative to OpenAI with a focus on “as honest as possible” artificial intelligence, and has already attracted interest from large funds including Sequoia and Andreessen Horowitz.