Elon Musk’s artificial intelligence ambitions just got a massive financial boost — this time from one of his own companies. According to investors close to the matter, SpaceX has agreed to invest $2 billion USD into xAI, Musk’s AI startup and maker of the Grok chatbot (via The Wall Street Journal).
The infusion accounts for nearly half of xAI’s recent $5 billion equity raise, announced by Morgan Stanley last month. The move marks SpaceX’s first known investment in xAI, and one of its largest external investments ever.
This comes just days after xAI unveiled Grok 4, its next-gen chatbot, and hailed it “the smartest AI in the world.” Grok 4 recently started rolling out to Tesla vehicles in beta, and Musk has even teased plans to integrate the AI into humanoid robots like Tesla’s Optimus.
xAI has been leaning heavily on Musk’s empire to catch up with rivals like OpenAI. In March, Musk merged xAI with social media platform X, valuing the former at a whopping $113 billion. xAI has expanded rapidly since then, though Grok has faced criticism for generating controversial responses on X. On Friday, the company apologized and said it’s taking steps to improve output.
SpaceX’s investment underscores how Musk continues to cross-pollinate his companies to fuel new ventures — much like when he borrowed $20 million from SpaceX to help fund Tesla in its early days. Grok now powers customer support features for SpaceX’s Starlink satellite internet service, and Musk has suggested more partnerships are in the pipeline.
Following news of the SpaceX-xAI deal, Musk posted on X that a potential investment from Tesla into xAI could also be on the table, “subject to board and shareholder approval.” xAI also secured $5 billion in debt financing alongside its equity raise, and according to one investor familiar with the matter, the startup is expected to pursue additional fundraising rounds later this year.
