Musk’s xAI Seeks Up to $12 B in Debt to Supercharge AI Chip Buying
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Musk’s year‑old venture, valued at $24 billion in its May equity round, is now courting non‑bank lenders for a giant debt package that would underwrite a shopping spree for Nvidia’s latest GB200 and GB300 chips—hardware essential for training Grok’s next generation. Sources quoted by the Journal say Antonio Gracias’s Valor Equity is spearheading talks, while some prospective creditors want a three‑year payback window and firm borrowing caps to curb risk.
xAI is already running roughly 230,000 GPUs but told investors it needs more than double that count to build a “gigafactory‑scale” data center slated to come online in 2026. Internal projections seen by Reuters peg the company’s cash burn at about $13 billion next year, making cheap leverage attractive despite higher interest rates and Musk’s own claim that xAI is “well‑funded for now.”
If the financing closes, it would rank among the largest private‑credit raises ever for a tech upstart, eclipsing recent chip‑plant loans by Intel and Micron. Analysts say the move underscores how AI infrastructure demand is pushing capital markets into uncharted territory—and puts fresh pressure on rivals OpenAI and Anthropic to secure their own long‑term silicon pipelines before supply tightens further.
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