Venture capital firm Gigafund, and Steve Jurvetson are among the backers considering investing in the round, the report said, citing people familiar with the matter.

The WSJ report also said that a co-founder of another venture firm is also among the backers. However, it did not name the person or the firm.

Terms of the xAI fundraising were not finalised and the plans could change, the Journal said, adding that current fundraising talks have gathered momentum recently.

xAI could not be immediately reached for comment. Musk’s office did not respond to a Reuters request for comment.

Seeking an alternative to Microsoft-backed OpenAI and Alphabet’s Google, Musk launched xAI last year.

Earlier this year, Musk said xAI was not in talks with investors to secure funding, following a media report about the startup raising up to US$6 billion.

The Financial Times in January reported xAI was in talks to raise funding at a valuation of US$20 billion.

“xAI is not raising capital and I have had no conversations with anyone in this regard,” Musk said at that time.

xAI in March launched an enhanced version of its chatbot Grok – named Grok-1.5, a chatbot rivaling OpenAI’s ChatGPT.

The chatbot is available to use by some users of X, formerly known as Twitter.