Berber Jin

There are a lot of engineering challenges that come with putting them and having them operate successfully in space.

Elon Musk, he's dreamed for the stars for his whole life.

He is, you know, obsessed with moving civilization from Earth to Mars.

And so if you're him, right, I mean, this is a very tantalizing prospect.

A lot of tech CEOs, including Sam Altman, Sundar Pichai at Google, Jeff Bezos, they've all talked about this idea of building data centers in space.

And Google has launched some pilot programs in that regard.

In the world of AI, it costs a lot of money and requires a lot of data center power.

So some investors kind of acknowledged that it was very difficult for XAI to survive as an independent company.

In the long term, they'd either have to keep raising huge sums of money or get acquired by one of Elon's other businesses.

For a long time, XAI and XE was clear that their businesses were kind of intertwined, like they were sharing data center capacity and employees were moving between the two.

Grok, the XAI chatbot, was put on X as a product that people could use.

So he ended up merging those two businesses last spring, and a lot of people at the time saw it as a way to kind of fortify two struggling businesses in Elon's empire.

XAI can continue to do its AI research without having to worry that much about all these business questions around profitability and growing revenue because SpaceX is such a strong business and has such a strong financial profile.

There's an advantage to going out first.

If SpaceX has a huge IPO, and now I guess since SpaceX is an AI company, right, they get to raise a lot more money.

They get the benefit of the kind of halo and the attention around going public.

And it definitely, I think, puts more pressure on OpenAI and Anthropic.

So XAI shareholders are very happy.

I mean, I think for a long time, most XAI investors that you talk to, they know that this is the end goal, right?

Like, I think none of them, even before this was announced, expected XAI to be an independent company that went public.