Elon Musk's artificial intelligence venture, xAI, has reportedly garnered commitments totaling $500 million from investors, with a target of reaching $1 billion, sources familiar with the matter revealed. Discussions suggest a potential valuation in the range of $15 billion to $20 billion, though terms are subject to possible adjustments in the coming weeks. Musk refuted the report on X, formerly known as Twitter, labeling it as "fake news." Launched last year as an alternative to Open AI, xAI, driven by Musk, focuses on developing a chatbot named Grok using data from social media posts on X. Grok gains an edge by accessing more recent data for responses compared to other chatbots.

Investors in xAI are likely to overlap with those who supported Musk's $44 billion Twitter takeover, including Larry Ellison, Sequoia Capital, Andreessen Horowitz, Fidelity Management & Research Co., and Saudi Prince Alwaleed bin Talal. Musk had earlier stated that equity investors in X would own 25% of xAI, translating to an invitation for them to invest at least 25% of their X investment amount in xAI.