Elon Musk's xAI Holdings Nears $20B Fundraise, Second to OpenAI

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Elon Musk's company, xAI Holdings, is talking to investors to raise about $20 billion for its new business, which combines artificial intelligence and social media. This money may be used to help pay off the debt Musk took on when he bought Twitter, which he later changed to a company called X after making it private.

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If Musk gets this deal done, it could be the second-largest amount of money ever raised for a new company, after OpenAI’s $40 billion deal earlier this year. According to PitchBook, a company that tracks investment data, OpenAI raised the most money. The new investment could make xAI worth more than $120 billion, although the exact amount to be raised is still undecided and could change.

xAI Holdings was created in March when Musk's AI company, xAI, merged with X (which used to be Twitter). Part of the new money raised could be used to pay off the large debt Musk has from buying Twitter, which he then changed to X.

Reports say Musk’s debt has become a big financial problem for X. Just in March, X spent around $200 million to pay the debt. By the end of next year, the interest payments on the debt could reach more than $1.3 billion each year.

After the merger, Musk and his team have been quietly asking possible investors if they would be interested in helping the new company. These talks are still in the beginning stages, and the goal is to raise the money over the next few months.

This new investment shows that many people are eager to invest in companies that work with technology. It also shows how important Musk is, not only as a businessman but also as someone who has played a big role in politics. Musk has worked closely with former U.S. President Donald Trump, helping to shape policies and put important people in key government jobs. However, Musk is expected to step away from politics soon.