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Two of Elon Musk’s private companies secure multibillion-dollar valuations through new deals as investors race to back the world’s richest man’s vast business interests I’m trying.
SpaceX, the largest private company in the U.S., is preparing to launch a tender offer in December that would sell existing shares in the business for about $135 a share, people familiar with the discussions said. The deal would value the rocket maker more than $250 billion, up from about $210 billion during a similar deal earlier this year.
Meanwhile, Musk’s artificial intelligence startup xAI has raised $5 billion at a valuation of $45 billion, nearly double its valuation from a few months ago, according to people familiar with the matter. Discussions between Mr. Musk and investors only began last month, and the funding was moved at breakneck speed.
The dual fundraising will see Musk expand his focus beyond Silicon Valley to Washington, D.C., where he helped deliver the U.S. election results to Donald Trump earlier this month, making him a key confidant of the president-elect. This was done in response to this.
On Tuesday, President Trump appointed Musk and biotech entrepreneur and former presidential candidate Vivek Ramaswamy to lead the new Office of Government Efficiency. Trump said in a statement that the government would “provide advice and guidance from outside the government” and look for ways to “dismantle” the bureaucracy.
Mr. Musk’s closeness to President Trump has also helped push up the stock price of Tesla, the electric car maker he runs as chief executive, by nearly 30% since the Nov. 5 election.
People close to xAI’s fundraising said the deal was “fully allocated,” meaning all of the new shares were allocated to investors, but it won’t officially close until the end of this month. They added that the deal was oversubscribed and only investors who backed the startup in previous funding rounds participated.
The huge interest in xAI, which runs a ChatGPT rival called Grok, has accelerated Musk’s efforts to compete with rivals such as OpenAI and Anthropic.
There is also already speculation that further funding could be raised in the first quarter of next year, potentially valuing the company at up to $75 billion, according to two people familiar with the matter. However, it was not yet clear whether this was communicated directly to investors by xAI.
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xAI has been developing a huge cluster of 100,000 graphics processing units in Memphis, the chips used to train and run AI tools. The project, called Colossus, is set to become one of the world’s largest supercomputers. Musk’s AI systems are likely to play a key role across his many companies, including X, Tesla, SpaceX, and Neuralink.
SpaceX is also likely to benefit from its closeness with President Trump. In addition to his long-held ambition to launch a mission to Mars, Musk wants to add to the network of 6,000 low-orbit satellites that make up the company’s Starlink broadband network. The billionaire has also regularly battled a range of U.S. regulators that he believes are interfering with Tesla and SpaceX.
Musk and SpaceX did not respond to requests for comment.
