Grok 4.1 Just Topped the Leaderboards, Only to Be Overtaken by Gemini 3—Musk Can No Longer Stay Calm!

Although he openly offered congratulations to Gemini 3, Musk was simultaneously scrambling to raise funds on the other front.

According to the latest report from The Wall Street Journal, xAI is planning a new round of financing totaling $15 billion (approximately 106.7 billion RMB), which would push the company’s valuation to $230 billion (approximately 1.6 trillion RMB).

This $230 billion figure more than doubles the $113 billion valuation Musk disclosed in March of this year (following the merger of xAI and X).

Netizens have expressed their amazement, remarking that Musk is simply too far ahead for ordinary people to understand.

Moreover, compared to growth giants like OpenAI, the speed at which xAI’s valuation has skyrocketed is staggering.

After all, OpenAI holds ChatGPT, a global blockbuster application that generates over $200 million in monthly revenue solely from subscriptions.

In contrast, xAI’s core product, Grok, remains deeply integrated into the X (formerly Twitter) ecosystem. Its user base and commercial influence are clearly not on the same scale as OpenAI’s.

This highlights the intensity of the AI boom.

Overview of xAI’s Financing History

Let’s first address the newly reported financing round for xAI.

According to The Wall Street Journal, these details were leaked by Musk’s wealth manager, Jared Birchall. However, it remains unclear whether the $230 billion valuation is pre-money or post-money, and no specific use of funds has been disclosed.

Interestingly, about a week ago, media reports claimed that xAI was seeking $15 billion in financing from investors at a $200 billion valuation. Musk later debunked this rumor:

He simply replied “False” to the relevant posts but provided no further explanation.

From the previous leak to this one, xAI’s reported financing amount remains at $15 billion, with valuations hovering around similar figures. The authenticity of these reports is currently highly questionable.

However, as of press time, neither Musk nor xAI has responded.

Nevertheless, looking back at xAI’s valuation growth over the past two and a half years since its inception, the speed of its rise is indeed shocking.

Musk officially announced the founding of xAI in July 2023. Initially, his stated goals were very broad, summarized by a single sentence:

To understand the true nature of the universe.

At that time, it positioned itself as a non-profit company, but it abandoned this status in May 2024.

Although it did not specify what “understanding the nature of the universe” entailed, xAI anchored itself in the large language model sector and continuously updated its models and products.

The latest model version is Grok 4.1, released just a few days ago, which narrowly lost to Google’s Gemini 3 in a blind human preference test.

Its main products include the Grok chatbot (an independent app plus integration on the X platform) running its proprietary models, and a new business line launched in October: Grokipedia, an AI-driven online encyclopedia.

To support its model and product R&D, xAI’s cash burn rate is accelerating.

In December 2023, SEC filings revealed that xAI’s first major external financing round raised approximately $134.7 million, primarily to get the company off the ground.

In 2024, xAI entered a phase of rapid growth.

Last May, xAI raised about $6 billion in its Series B round. Just six months later, it conducted another $6 billion Series C round, bringing its post-money valuation to $50 billion.

Entering 2025, a major development was the formal merger in March of Musk’s two companies, xAI and X:

xAI acquired X (Twitter) through an all-stock transaction. In this deal, xAI was valued at $80 billion, while X was valued at $33 billion ($45 billion in assets minus $12 billion in debt).

The merged entity is called XAI Holding, with a combined valuation of $113 billion.

Furthermore, according to Wikipedia, xAI reportedly conducted large-scale debt and equity financing in July after the merger:

Morgan Stanley arranged $5 billion in debt financing, while xAI secured an additional $5 billion in equity financing (including a $2 billion investment from Musk’s SpaceX).

Now, its valuation has reached the rumored $230 billion. If true, the company’s valuation has surged from $50 billion at the end of last year to over $200 billion today—quadrupling in less than a year.

Additionally, Tesla discussed whether to invest in xAI during its annual meeting this year. Although the outcome is undecided, preliminary voting indicates that most shareholders agreed to invest in xAI.

Who could say it’s not a promising future? (doge)

Skyrocketing Valuations of Large Model Companies; OpenAI Also Accelerating Cash Burn

In fact, from last year until now, a clear trend has emerged:

Large model companies are experiencing their latest wave of valuation surges.

Not only xAI, but its competitor OpenAI is also seeing rapid valuation growth.

Based on a special transaction completed in October this year (secondary resale of employee shares), OpenAI’s valuation was pushed to $500 billion, an increase of nearly 67% from the $300 billion valuation during SoftBank-led financing earlier this year.

Additionally, Musk just released Grok 4.1 Fast, a fast-reasoning version.

He specifically highlighted that it defeated Google’s Gemini 3 in benchmark tests.

Musk’s counterattack was indeed swift (doge).