Elon Musk’s artificial intelligence company xAI has secured $20bn (£15.7bn) in fresh funding, pressing ahead with its expansion plans even as its flagship chatbot, Grok, faces intensifying global scrutiny over the creation of sexualised and non-consensual images of women and children.
The Series E funding round, announced on Tuesday, exceeded xAI’s initial $15bn target and attracted heavyweight backers including Nvidia, Fidelity, Qatar’s sovereign wealth fund and Valor Equity Partners, the private investment firm run by Antonio Gracias, a long-time Musk ally.
In its announcement, xAI highlighted Grok’s image-generation capabilities as a core part of its technological proposition — a move that has raised eyebrows given the controversy now engulfing the platform.
While xAI lacks the brand recognition of rivals such as OpenAI, the maker of ChatGPT, it has nonetheless continued to attract significant capital and government contracts amid the global AI investment boom. That momentum has persisted despite repeated criticism over Grok’s output, including allegations of misinformation, antisemitic content and now potentially illegal sexual imagery.
Over recent days, Grok has responded to tens of thousands of prompts on Musk-owned platform X requesting the digital removal of women’s clothing or the creation of sexualised images without consent. Among those targeted was Ashley St Clair, the estranged mother of one of Musk’s children, who said complaints made to the platform went unanswered.
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