Elon Musk Launches xAI Company to Counter OpenAI

Elon Musk just announced that his latest startup, xAI, will focus on artificial intelligence.
xAi iBosto

Elon Musk just announced that his latest startup, xAI, will focus on artificial intelligence. The company's website states that xAI aims to "know the true nature of the universe". 

Musk's new AI venture is the latest in a series of entities he has cofounded and heads including Tesla, SpaceX and The Boring Company. As of July 2023, Musk is the world's richest man with a net worth of $254 billion.

Main Points
  • Musk's new AI venture is the latest in a series of entities he has cofounded and heads including Tesla, SpaceX and The Boring Company.
  • In July 2023 this year, Musk is the richest man in the world with assets of $ 254 billion.
  • Musk is also in talks with several venture capitalists of SpaceX and Tesla to invest money in his new business.
  • The Musk-backed generalized AI project will soon enter a narrow and niche market.

xAI Team

"Today we're announcing the foundation of xAI. xAI aims to discover the true nature of the universe. Our team is led by Tesla and SpaceX CEO Elon Musk. We've previously worked at DeepMind, OpenAI, Google Research, Microsoft Research, Tesla and the University of Toronto. 

Together we contributed some of the most widely used processes in the field, notably Adam Optimizer, Batch Normalization, Layer Normalization and detection of adversarial contexts. 

We introduced and reviewed unique technologies such as Transformer-XL, Autoformalization, Memorize, Transformer, Group Proof Scaling and µTransfer. Some of the best incentives we have worked on, as well as led their development, including AlphaStar, Alphacode, Inception, Minerva, GPT-3.5 and GPT-4 . We will provide more details in the coming weeks and months."

A person who was a direct witness to the conversation said, Musk is also in talks with several venture capitalists of SpaceX and Tesla to invest money in his new business. “A lot of people are putting money into it. It is true and they are passionate about it,'' the person said. 

In addition, the report also suggested that Musk had obtained several GPU processors from Nvidia to enable a potentially large language model. That same month, Musk published his intentions for a new AI tool called "TruthGPT" during an interview aired on Fox News Channel, and said he feared existing AI companies were favoring "Politically Correct" systems.

During a Conversation on Twitter Space, when Musk was asked about all the GPUs he's acquired, the millionaire made no mention of his plans to set up an AI company, saying, "Looks like everyone and their pet is buying GPUs right now." The alleged X.AI name X Corp. 

Coincides with, symbolized by "X", which he used on his principle of "app everything". One of the AI startup's mentors will be Dan Hendricks, chief executive officer of the San Francisco-based non-profit organization Center for AI Security, which in May issued a letter backed by technical leadership saying that "Reducing the risk of extinction due to AI should be a global priority, along with other community-level threats similar to pandemics and nuclear war."

Listen to this Conversation on Twitter Space


New Company to Musk's

xAI has added a new company to Musk's portfolio, about a month after he officially stepped down as Twitter CEO. He has played a key role in the company as Executive Head and Chief Technology Officer. According to the new company's website, the AI startup will "Collaborate" with Tesla and Twitter but remain independent.

According to XAI co-founder Greg Yang (@greg16676935420), one side of startup AI will delve deeper into "the mathematics of deep learning" and "build a 'theory of everything' for large neural networks" to take AI "to the next level".

Musk has been outspoken against OpenAI, the AI organization he co-founded in 2015 but split from in 2018, and recently signed a letter calling for a halt to "huge AI experiments." In recent months, OpenAI, along with ChatGPT and GPT-4, has become a respected name in the technology and is in part driving the contemporary effort by Microsoft and Google to more directly incorporate AI tools into many of their products. 

Musk reportedly set up xAI in Nevada in March. Earlier, he changed the name of Twitter to "X Corp". In some financial documents, but not on XAI's website, the company has indicated its separation from X Corp, saying it will "collaborate with X (Twitter), Tesla and other companies to accomplish our mission."

What did People in The Know About The New Project Say?

People with knowledge of the move said Musk has obtained several high-performance GPU processors from Nvidia for the new project. 

GPUs are the advanced-level chips needed to operate a large language model – an AI system capable of understanding large amounts of content and visualizing human typing or directness, similar to the technology that inspired ChatGPT. The speed at which Musk is moving forward will raise eyebrows in some parts of the AI community, as he led a letter supported by thousands of other tech geniuses proposing a ban on building GPT-type models over security issues.

Millionaire's potential foray into the hot generative AI market will add another dimension to his diverse portfolio of responsibilities and capital. It houses the Twitter and Tesla operations as well as SpaceX, their $137 billion missile-maker, Neuralink, a brain-technology firm, and The Boring Company, a tunneling start-up. 

According to people with knowledge of his plans, Musk is recruiting engineers from leading AI labs, including DeepMind, which said it began exploring the idea of a competing company earlier this year in response to OpenAI's rapid progress.

Musk has enlisted former DeepMind employee Igor Babushkin and about a half-dozen other engineers. The Information previously published information on Babushkin's initial conversation with Musk. The new company will enable Musk to acquire OpenAI, the Microsoft-produced group they co-founded in 2015. 

According to two people involved in OpenAI at the time, they parted ways with the council after three years, due to differences over its management, including its posture toward AI security. In no time, the organization was transformed into a profitable start-up, and raised $1 billion in investment from Microsoft.

Since then, Musk has become increasingly vocal in his fear of wider existential threat from AI systems. He has publicly criticized OpenAI for becoming less transparent and more commercial-minded in its pursuit of advanced AI. Kasturi is particularly concerned about the danger of models like GPT-4, the latest release of OpenAI, to spread lies and show political bias.

During a Twitter Spaces conversation this week, Musk was asked about a Business Insider report that Twitter bought more than 10,000 Nvidia GPUs, Musk said, "Looks like everyone and their pet is buying GPUs right now." “Twitter and Tesla must be buying GPUs."

People close to Musk's mind say his new AI project is different from his other companies, though it may use Twitter content as data, to train its language models, and restrict Tesla to computing resources.
While the exact position of the AI team in Musk's corporate empire is unclear, he recently moved Twitter Inc., which he acquired last year for $44 billion, into a new holding company, X Corp. 

During this week's Twitter Space session, Musk gushed about Tesla's in-house supercomputer, Dojo, which the electric-car maker uses to train its Autopilot self-driving system. I think there are many opportunities in the dojo that people don't know about." Musk said. He indicated that Dojo could be made available as a platform to other companies, such as Amazon renting out its massive server infrastructure as AWS.

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The Musk-backed generalized AI project will soon enter a narrow and niche market. Tech giants Microsoft, Google and Amazon, as well as start-ups such as OpenAI, Anthropic, Adept and StabilityAI, which recently raised hundreds of millions of dollars, will compete.

Musk left OpenAI in 2018, publicly citing the reason that he wanted to focus on Tesla, which was also investing heavily in AI. "Tesla was starting to get competitive with OpenAI, and I didn't like some of the choices the OpenAI team made," Musk tweeted in 2019. He said that "separation in pleasant circumstances is the only solution".

When he left OpenAI, people close to him say Musk clashed with other board members and activists, including a disagreement between him and the company's "options" on the issue of AI security. Another person who worked at the company at the time cited a troubled all-employee meeting in 2018 to explain Musk's departure. The person said, "[at that time] the most motivating moment for us was the moment in which we rejoiced only to be free from Musk."