xAI funding reshapes Elon Musk’s wealth as $20 billion round lifts valuation to $250 billion

Elon Musk’s latest xAI funding surge has pushed his personal fortune and the company’s valuation to unprecedented levels in the global technology sector.

xAI raises $20 billion at $250 billion valuation

Artificial intelligence venture xAI Holdings secured $20 billion from private investors in January 2026, according to documents reviewed this week by Forbes. The round valued the company at $250 billion, doubling the previous $113 billion mark set in March 2025 when Musk folded xAI into social platform X.

Musk controls 49% of xAI Holdings. That stake is now valued at $122 billion, representing a $62 billion gain in his personal fortune following the latest capital injection. Moreover, Forbes now pegs his total net worth at $780 billion, reinforcing his lead at the top of the global rich list.

This new valuation leaves Musk just $20 billion away from the symbolic $800 billion wealth threshold, a level no individual has previously reached. He currently holds about a $510 billion advantage over Larry Page, the world’s second richest person with an estimated net worth of $270 billion as of 2025.

Billionaire backers cash in on xAI’s rise

The valuation spike also delivered major gains for several billionaires who helped finance Musk’s 2022 acquisition of Twitter, now X. Saudi investor Prince Alwaleed Bin Talal Alsaud controls roughly 1.6% of xAI Holdings, a stake worth about $4 billion. As a result, his personal wealth has climbed to around $19.4 billion.

Early backers Jack Dorsey and Larry Ellison each own close to 0.8% of xAI, with positions valued at approximately $2.1 billion per investor. Both originally committed $1 billion apiece to the Twitter deal. Dorsey’s net worth now stands near $6 billion, while Ellison’s fortune has grown to about $241 billion, underlining how the xAI valuation boom has rewarded loyal partners.

Heavy xAI cash burn to build advanced AI and robotics

Behind the soaring valuation, xAI is spending aggressively to develop frontier technology. Internal documents seen by Bloomberg show the firm burned $7.8 billion during the first three quarters of 2024. By September 2024, the company reported a loss of $1.46 billion, highlighting the capital-intensive race to build cutting-edge artificial intelligence.

Despite the steep losses, xAI generated about $107 million in quarterly revenue, according to the same records. However, the company continues to lean heavily on investor capital to design AI systems capable of controlling humanoid robots, including Tesla’s Optimus model. This robotics ambition illustrates why the latest xai funding round has drawn intense interest across both technology and capital markets.

Grok chatbot lawsuit and integration across Musk’s empire

Rapid growth has also brought legal scrutiny. xAI now faces a lawsuit targeting its Grok AI chatbot. On Thursday, political commentator Ashley St. Clair sued the company, alleging Grok generated unauthorized explicit deepfake images of real women, including content created without consent. St. Clair has a child with Musk, adding further public attention to the case.

Musk has tightly integrated Grok across his business ecosystem. The chatbot is embedded on X and operates inside Tesla vehicles, extending its reach from social media to automotive interfaces. Moreover, SpaceX has invested directly in xAI and purchased hundreds of millions of dollars worth of Tesla batteries, signaling deep operational ties between the ventures.

SpaceX valuation surge and Musk’s wealth milestones

Musk’s fortune accelerated sharply through 2025 as his companies’ valuations climbed. Tesla shares nearly doubled after he exited a government position in October 2025, propelling him to become the first person with wealth of around $500 billion. Later that year, SpaceX reached an $800 billion valuation in December 2025, pushing his net worth above $600 billion.

In a further boost, a Delaware Supreme Court ruling restored $126 billion in previously contested Tesla stock options to Musk. That decision, delivered in December 2025, elevated him to the first person ever worth roughly $700 billion. That said, the decision also intensified debate over executive compensation and corporate governance standards at Tesla.

Breakdown of Musk’s major assets

Musk’s largest single asset is his 42% stake in private space company SpaceX, valued at about $336 billion. His Tesla exposure, including roughly 12% common stock plus additional options, totals around $307 billion. Together, these holdings anchor his status as the richest individual on record.

Looking further ahead, a proposed Tesla compensation package, expected to go to a shareholder vote in November 2025, could grant Musk up to $1 trillion in stock over ten years if aggressive performance milestones are achieved. However, hitting those targets would require sustained growth in Tesla’s market capitalization and profitability, making the potential payout one of the most ambitious incentive structures ever considered.

Ellison’s retreat from the $400 billion club

While Musk continues to set new highs, Ellison is the only other individual to have briefly crossed the $400 billion wealth mark. He reached that level in September 2025 before seeing his fortune fall by about $159 billion, according to wealth trackers. Moreover, his current net worth of $241 billion underscores how volatile ultra-high fortunes can be, even for long-established technology leaders.

In summary, xAI’s $20 billion raise and $250 billion valuation have turbocharged Musk’s path toward the unprecedented $800 billion wealth milestone, enriched early backers like Prince Alwaleed, Jack Dorsey, and Larry Ellison, and intensified scrutiny of his AI and robotics ambitions.