Musk Said to Envision Supercomputer as xAI Raises $6 Billion

Elon Musk’s xAI has secured $6 billion in Series B funding. While the company says the funds will be “used to take xAI’s first products to market, build advanced infrastructure, and accelerate the research and development,” some outlets are reporting a significant portion is earmarked to build an AI supercomputer to power the next generation of its foundation model Grok. The company publicly released the open-source Grok-1 as a chatbot on X social in November, and recently debuted Grok-1.5 and 1.5V iterations with long-context capability and image understanding.

“According to a new report from The Information, Musk is about to split his time with yet another major project: an xAI supercomputer, which he has been calling a ‘gigafactory of compute,’” Mashable writes, adding that the report is based on “an investor presentation” Musk has been iterating and using to raise money for xAI.

To power the supercomputer project, “Musk is looking to connect 100,000 Nvidia H100 GPUs — around four times the size of the current biggest GPU cluster,” Mashable explains, adding that he has been in talks with Oracle “on a $10 billion deal with the company to rent its AI servers” to run the system.

“Musk said earlier this year that the latest Grok 2 model was trained using 20,000 Nvidia H100 GPUs. He’s now looking to increase that by 5 times as many chips in order to train Grok 3,” according to Mashable. “Oracle chairman Larry Ellison told investors that it had worked with Musk to train its Grok model, but xAI originally wanted more Nvidia GPUs than Oracle was able to provide.”

Musk is moving quickly on AI, having unveiled xAI in July 2023 and added the Grok chatbot to X social in beta in November.

The investor presentation reportedly said the company was targeting the $6 billion Series B round in order to get an $18 billion xAI valuation, which goal Musk said in a post on X that he has achieved, per The New York Times. Recent reports, such as this Tuesday write-up by CNN, values the company at $24 billion.

X announced the latest funding round in a blog post that also indicates it “is hiring for numerous roles and seeks talented individuals ready to join a small team focused on making a meaningful impact on the future of humanity.”

NYT details exploding AI valuations, noting that “OpenAI, which unveiled the ChatGPT chatbot in late 2022, has roughly tripled its valuation over the past year or so, to $80 billion, with some $13 billion in backing from Microsoft,” while “Anthropic, which was founded in 2021, has raised roughly $8 billion, much of it from Amazon, and reached a valuation of about $15 billion.”

Big Tech firms including Google and Meta “have also spent heavily on their own AI technologies, which are quickly being incorporated across their product lineups,” NYT reports.

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