xAI raises $20B in Series E

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Welcome back to The Pulse, where we dive into interesting AI stories and trends backed by data, all presented through simple visuals.

> raised $5B above $15B target (valuation undisclosed), despite Musk denying fundraising claims earlier; total = $42.1B raised

> claims 600M monthly active users across X + Grok - reports put Grok at 30M MAUs after 5M added in Dec ‘25

> also holds 1M H100-equivalent GPUs across their datacenters

> Grok 4.2 expected soon; Grok 5 already in training

> funds raised despite heavy criticism over Grok's antisemitic behaviour & non-consensual sexualized content

> Grok adhering to user requests to generate non-consensual, sexually explicit images of real women & minors

> including nudity & violent depictions, widely circulated on X since Dec-end

> requests directly on Grok reportedly far more extreme - large share classified as CSAM

> despite multi-country backlash, traffic increased: Grok also recorded 82M posts in total + X logged highest-ever start-of-year engagement

> Grok topped multiple app stores including Belgium, France, Spain etc. as of Jan 7th

> daily downloads surged Jan 2-5: Grok +54%, X +25%

> xAI thus gained massive global traffic from the controversy despite regulatory & user backlash

> funds ultra-concentrated & frequent: $68B taken by OpenAI, Anthropic & ScaleAI

> 14% of global VC to OpenAI & Anthropic alone - investors betting mainly on late-stage "winners"

> AI = half of all (not just VC) funds globally: $202B AI vs $203B all else (Crunchbase)

> valuations exploding with each round, in turn assisting with recruitment of scarce talent

> startups advised to stockpile cash now before 2026 downturn

> money already running out: Thrive, a16z, Tiger Global scrambling to raise new funds