• Elon Musk seeks $6 billion for xAI’s Memphis data center
• Funding to purchase 100,000 Nvidia chips for AI projects
• Data center will power Tesla’s Full Self-Driving capabilities

Elon Musk knows that staying competitive in the AI space requires deep pockets – back in February 2024, the world’s richest man said Tesla would spend “over a billion dollars” on Nvidia’s H100 and AMD’s Instinct MI300 hardware, adding, “The table stakes for being competitive in AI are at least several billion dollars per year at this point.”

More recently, the controversial billionaire gave us a tour inside the massive AI supercluster, dubbed Cortex, being used by X (formerly Twitter) and followed that up with news that Colossus, a new 100k H100 training cluster for Musk’s artificial intelligence company xAI, is now up and running.

According to CNBC’s David Faber, Elon Musk has raised up to $6 billion (at a $50 billion valuation) to purchase 100,000 Nvidia chips for xAI’s Memphis data center, which will – among other things – power Tesla’s full self-driving (FSD) capabilities.

Musk’s government role

Sources familiar with Musk’s plans told Faber that the $6 billion funding comes from $5 billion of sovereign funds in the Middle East and $1 billion from other investors who will have the option to increase their investment.

Following Donald Trump’s election victory and the announcement that Elon Musk will lead the new Department of Government Efficiency within the president-elect’s administration, we can expect to see sizable government changes regarding AI regulation.

Musk’s future role, despite potential conflicts of interest, is to “dismantle government bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure federal agencies.”

However, no one believes for a second that this will be the limit of his involvement in wider policy decisions.

As CNBC reports, “Trump plans to repeal President Joe Biden’s executive order on AI, according to his campaign platform, stating that it ‘hinders AI innovation and imposes radical left-wing ideas on the development of this technology,’ and that ‘in its place, Republicans support AI development rooted in free speech and human flourishing.’”

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