Dataconomy
  • News
    • Artificial Intelligence
    • Cybersecurity
    • DeFi & Blockchain
    • Finance
    • Gaming
    • Startups
    • Tech
  • Industry
  • Research
  • Resources
    • Articles
    • Guides
    • Case Studies
    • Glossary
    • Whitepapers
  • Newsletter
  • + More
    • Conversations
    • Events
    • About
      • About
      • Contact
      • Imprint
      • Legal & Privacy
      • Partner With Us
Subscribe
No Result
View All Result
  • AI
  • Tech
  • Cybersecurity
  • Finance
  • DeFi & Blockchain
  • Startups
  • Gaming
Dataconomy
  • News
    • Artificial Intelligence
    • Cybersecurity
    • DeFi & Blockchain
    • Finance
    • Gaming
    • Startups
    • Tech
  • Industry
  • Research
  • Resources
    • Articles
    • Guides
    • Case Studies
    • Glossary
    • Whitepapers
  • Newsletter
  • + More
    • Conversations
    • Events
    • About
      • About
      • Contact
      • Imprint
      • Legal & Privacy
      • Partner With Us
Subscribe
No Result
View All Result
Dataconomy
No Result
View All Result

Elon Musk’s xAI reportedly raising $20 billion in deal tied to Nvidia chips

Elon Musk’s xAI is raising up to $20 billion through a mix of equity and debt, with Nvidia investing $2 billion and GPU-backed financing helping fund its Colossus 2 AI data center in Memphis.

byKerem Gülen
October 8, 2025
in Industry

Elon Musk’s artificial intelligence startup, xAI, is reportedly in the process of raising $20 billion in a new financing round that includes a significant investment from Nvidia. The funding is larger than initially planned and is structured to secure the massive number of processors required to build out the company’s AI infrastructure.

According to people with knowledge of the matter, the financing includes both equity and debt in a special purpose vehicle (SPV). This SPV will be used to purchase Nvidia processors, which will then be rented to xAI for use in its Colossus 2 project, the company’s largest data center located in Memphis.

Details of the financing deal

The complex deal is reportedly structured as follows:

Stay Ahead of the Curve!

Don't miss out on the latest insights, trends, and analysis in the world of data, technology, and startups. Subscribe to our newsletter and get exclusive content delivered straight to your inbox.

  • Total amount: Up to $20 billion.
  • Equity portion: Approximately $7.5 billion.
  • Debt portion: As much as $12.5 billion in the SPV.

Nvidia is said to be investing as much as $2 billion in the equity portion of the deal, a strategic move by the chipmaker to help accelerate its customers’ AI investments. The debt portion, which is backed by the GPUs themselves rather than xAI’s corporate assets, is being participated in by firms including Apollo Global Management and Diameter Capital Partners. The equity portion is being led by Valor Capital.

This unique deal structure, where the hardware itself collateralizes the debt, could provide a model for other tech companies looking to finance large-scale infrastructure projects while minimizing their direct debt exposure.

A capital-intensive race for AI dominance

This massive financing effort is the latest example of the frenetic pace of investment in the AI industry. Major tech companies are spending tens of billions of dollars to build the infrastructure necessary to develop advanced AI models.

  • Earlier this week, OpenAI announced a multi-year deal to use chips from AMD.
  • Meta has recently secured a $29 billion financing package for its data centers.
  • Oracle has raised a $38 billion debt package for its infrastructure.

Data center capacity is widely seen as a critical component for developing top-tier AI models.

xAI’s need for capital

Elon Musk’s xAI is particularly in need of significant capital. The company, which already raised about $10 billion earlier this year, has reportedly been burning through cash at a rate of $1 billion per month. Musk has also drawn investments from his other companies, including SpaceX. Tesla investors will soon vote on whether the electric car company should also invest in xAI.

Musk views AI as the foundational technology for many of his futuristic products, including self-driving cars and fully autonomous robots, making the success of xAI critical to his broader ambitions.


Featured image credit

Tags: Featuredxai

Related Posts

React finds a new home at the Linux Foundation with M Meta support

React finds a new home at the Linux Foundation with $3M Meta support

October 8, 2025
SoftBank to acquire ABB’s robotics division for .4 billion

SoftBank to acquire ABB’s robotics division for $5.4 billion

October 8, 2025
Supabase raises 0m series E, valuation at b

Supabase raises $100m series E, valuation at $5b

October 7, 2025
Young founder’s Supermemory raises .6M from Cloudflare and Google execs

Young founder’s Supermemory raises $2.6M from Cloudflare and Google execs

October 7, 2025
AMD stock soars following the landmark OpenAI AMD GPU partnership

AMD stock soars following the landmark OpenAI AMD GPU partnership

October 6, 2025
Renault to cut 3,000 jobs via “Arrow” program

Renault to cut 3,000 jobs via “Arrow” program

October 6, 2025

LATEST NEWS

AI is now the number one channel for data exfiltration in the enterprise

Google expands its AI vibe-coding app Opal to 15 more countries

Google introduces CodeMender, an AI agent for code security

Megabonk once again proves you don’t need fancy graphics to become a hit

Qualcomm acquires Arduino, announces new hardware and development tools

Shinyhunters extorts Red Hat over stolen CER data

Dataconomy

COPYRIGHT © DATACONOMY MEDIA GMBH, ALL RIGHTS RESERVED.

  • About
  • Imprint
  • Contact
  • Legal & Privacy

Follow Us

  • News
    • Artificial Intelligence
    • Cybersecurity
    • DeFi & Blockchain
    • Finance
    • Gaming
    • Startups
    • Tech
  • Industry
  • Research
  • Resources
    • Articles
    • Guides
    • Case Studies
    • Glossary
    • Whitepapers
  • Newsletter
  • + More
    • Conversations
    • Events
    • About
      • About
      • Contact
      • Imprint
      • Legal & Privacy
      • Partner With Us
No Result
View All Result
Subscribe

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy Policy.