Elon Musk's xAI secures $5 billion amid low investor interest

Business Jun 18, 2025

Elon Musk's new AI startup, xAI, is about to lock in a $5 billion debt deal led by Morgan Stanley.
The funding mix includes floating-rate and fixed-rate loans plus secured bonds, but investor excitement has been pretty mild—orders only hit 1.5 times the offer, which is lower than usual.

xAI also aims to raise another $20 billion in equity

Investors are holding back since xAI isn't profitable yet and its debt isn't rated. Plus, memories of Musk's bumpy Twitter takeover aren't helping confidence.
Despite this, xAI also aims to raise another $20 billion in equity soon as it chases a bigger valuation.
The company says it wants to build safe AI—definitely ambitious!