PALO ALTO, California: Elon Musk's artificial-intelligence venture is preparing for one of the most significant fundraising efforts in the sector to date, with xAI reportedly nearing a multibillion-dollar deal that would push its valuation into the upper tier of global tech startups.

According to the Wall Street Journal, the company is in advanced talks to raise US$15 billion in new equity at a valuation of $230 billion. Musk's wealth manager, Jared Birchall, shared the information with potential investors during a briefing, the paper said. It was not immediately clear whether the figure represented a pre- or post-money valuation.

The report could not independently be verified, and attempts to reach Birchall were unsuccessful. xAI, in what appeared to be an automated response, replied to a Reuters query with: "Legacy Media Lies."

If completed at the reported valuation, the funding round would more than double xAI's previously disclosed valuation of $113 billion, a figure that emerged when the startup merged with Musk's social media platform X in March.

The latest news comes just a week after Musk rejected a CNBC report that xAI was pursuing a $15 billion Series E round valuing the firm at $200 billion, calling that information "false."

Founded in July 2023 as a competitor to OpenAI, xAI has been aggressively expanding its data-center infrastructure to build more advanced AI models and narrow the gap with rivals like ChatGPT and Anthropic's Claude. The company is investing heavily in hardware and facilities, including land in Memphis, Tennessee, where it plans to construct its Colossus supercomputer.

Musk has previously suggested that Tesla could help support xAI, and Tesla shareholders recently approved an investment in the startup, though a significant number abstained from the vote.

Despite growing concerns that the sector is entering an "AI bubble," investor demand for AI startups remains strong, driven by rapid technological progress and soaring valuations across the industry.