Tesla’s Elon Musk Closes In on $800 Billion After xAI Funding Deal

TLDR

• Elon Musk’s xAI Holdings raised $20 billion from private investors at a $250 billion valuation in January 2026
• The funding boosted Musk’s net worth to $780 billion, putting him $20 billion away from becoming the first person worth $800 billion
• Other investors including Prince Alwaleed Bin Talal Alsaud, Jack Dorsey, and Larry Ellison also saw gains from the increased valuation
• xAI burned through $7.8 billion in cash during the first nine months of 2024 according to internal documents
• The company’s Grok chatbot faces criticism and a lawsuit for generating fake explicit images of real women

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Elon Musk’s xAI Holdings completed a $20 billion funding round from private investors in January 2026. The company reached a valuation of $250 billion.

Forbes confirmed the funding details earlier this week. The new valuation represents more than double the $113 billion value Musk claimed when he merged his AI startup xAI with social media platform X in March 2025.

The funding round increased the value of Musk’s 49% stake in xAI Holdings by $62 billion to $122 billion. Musk now has a total net worth of $780 billion according to Forbes’ Real-Time Billionaires List.

Several other billionaire investors also benefited from the valuation increase. Saudi Arabian Prince Alwaleed Bin Talal Alsaud owns an estimated 1.6% stake in xAI Holdings worth $4 billion. This brought his total net worth to $19.4 billion.

Twitter cofounder Jack Dorsey and Oracle cofounder Larry Ellison each own approximately 0.8% of xAI Holdings valued at $2.1 billion. Dorsey’s net worth now stands at $6 billion while Ellison’s reaches $241 billion. All three were early investors in Musk’s $44 billion Twitter acquisition in 2022.

Company Spending and Challenges

Internal documents reviewed by Bloomberg show xAI burned through $7.8 billion in cash during the first nine months of 2024. The company reported a net loss of $1.46 billion by September 2024.

xAI’s quarterly revenue hit $107 million according to financial documents shared with Bloomberg. The company uses funds raised from investors to build self-sustaining AI models capable of operating humanoid robots.

The company’s Grok chatbot has faced recent criticism. A lawsuit was filed Thursday by Ashley St. Clair, the mother of one of Musk’s children. The suit alleges Grok generated fake explicit images of real women without consent.

Musk has integrated Grok across his business ventures. The chatbot is fully integrated with X and built into Tesla vehicles. SpaceX has invested in xAI while also purchasing several hundred million dollars in Tesla batteries.

Musk’s wealth has grown rapidly over the past year. He became the first person worth $500 billion in October 2025 after Tesla’s stock price nearly doubled. In December, SpaceX’s valuation doubled to $800 billion, pushing Musk’s net worth past $600 billion.

Days later, the Delaware Supreme Court overturned a lower court ruling that had voided $126 billion worth of Tesla stock options awarded to Musk. This made him the first person worth $700 billion.

SpaceX remains Musk’s most valuable asset with his 42% stake worth $336 billion. His Tesla holdings total $307 billion, which includes 12% of the company’s common stock plus stock options. Tesla awarded Musk a new pay package in November that could provide up to $1 trillion in additional stock if the company hits specific performance targets over ten years.

Musk now holds a $510 billion lead over the world’s second wealthiest person, Google cofounder Larry Page, who is worth $270 billion. Only Larry Ellison has previously reached a $400 billion net worth, briefly achieving that milestone in September before his fortune declined.

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