Elon Musk’s AI startup, xAI, is seeking US$12 billion to build its second data center, Colossus 2.

This comes after launching its first data center, Colossus, in Memphis, Tennessee, which operates 200,000 GPUs.

To fund the project, xAI is approaching private-equity firms like Valor Equity Partners, a past investor in fellow Musk-led companies, SpaceX and Tesla.

The company has previously raised at least US$20 billion, including $2 billion from SpaceX.

XAI was last valued at US$75 billion but remains unprofitable, with limited revenue. Projections suggest it could burn through US$13 billion in cash by 2025.

Recent xAI developments