xAI vs OpenAI vs Anthropic

TL;DR: With its 100,000 GPU cluster and proprietary access to a million gigabytes of daily tweet data, xAI is Elon Musk's bid to take on OpenAI—the company he co-founded but left in 2018. Sacra estimates xAI reached $100M in annualized recurring revenue at the end of 2024, with $12B+ raised at a $50B valuation for a 500x revenue multiple. For more, check out our full report and dataset on xAI.

Key points via Sacra AI:

Founded by former OpenAI board member and co-founder Elon Musk in March 2023, xAI launched its "free speech" ChatGPT alternative, Grok, as an AI chatbot with deep integration into X (formerly Twitter) for generating images, explaining & summarizing tweets & threads, and semantic tweet search. Where OpenAI, Anthropic, and Google's AI chatbots have been extensively post-trained for harm prevention, Grok found product-market fit as an edgelord AI companion that generates photo-realistic images of celebrities (Trump and Kamala kissing) and tells vulgar jokes—but still refuses outright gore, nudity and hate speech.
Initially available only for X Premium subscribers ($7-14/month), Sacra estimates xAIhit $100M in annualized recurring revenue (ARR) at the end of 2024 between membership revenue (via X) and its API (used by Starlink for customer service), raising $6B in a December Series C that brought its total raised to $12B+, valued at $50B or a 500x forward revenue multiple. Compare to leading AI labs like OpenAIat $5B in revenue at the end of 2024 (up 213% YoY) valued at $157B for a 31x multiple, and Anthropicat $1B in revenue for 2024 (up 566% YoY), valued at $60B for a 60x multiple.
The pure play AI lab built for the Elon Musk platform & ecosystem of companies (nearly $2T in market cap), xAI uses Musk’s access to capital, his companies X (via Grok memberships) and SpaceX (via their xAI-powered customer service chatbot) as initial customers, and their access to proprietary data to rapidly scale revenue and then feed that back into R&D to solve hard, technical problems. With their Memphis-based "Colossus" cluster of 100,000 GPUs (3x leading cluster size), xAI has become one of the largest-scale AI labs in the world, training on real-time tweet data from X (million gigabytes per day) and in the future, sensor data from Tesla (50 billion miles per year)—with the upside of generating revenue by licensing their models back to Tesla to improve self-driving.

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