Elon Musk boasts: Crush all opponents in 5 years! xAI invests billions to build supercomputing empire

Elon Musk announced on Twitter: xAI will have more AI compute power within 5 years than all of its competitors combined, including Google, OpenAI, Meta, and Microsoft. xAI’s valuation skyrocketed to $200 billion, with Middle Eastern funds entering the scene, and Musk can even leverage Tesla and SpaceX for financing. The Colossus supercomputing center bears his ambitions for computing power, with hundreds of thousands of GPUs and billions of dollars burning.

The Extreme Engineering Philosophy of the Colossus Supercomputing Center

xAI’s supercomputing center Colossus embodies Musk’s ambitions for extreme scale and physical compute capacity in AI. Musk has a profound admiration for the scale of the physical world: massive starships, over 90% of global launches annually, and Starlink wrapping the Earth. This obsession with scale extends to compute power—while others optimize architectures, Musk straightforwardly pursues brute force, stacking compute.

Musk is also an engineering fanatic. He deeply involves himself in Tesla’s Gigafactories and Starship bases, so although the xAI supercomputing center only began construction in late 2024, it was put into operation in a very short time. His guiding engineering philosophy is first to get the compute running: “Just get the compute up and running.” The outside world will see construction ongoing outside the compute center, but the racks are already working—this edge of building while operating is an aggressive approach unimaginable in traditional tech companies.

The core of this engineering philosophy is speed above all. Musk is surrounded by a young, fiercely loyal team pushing engineering at astonishing speed. Musk aims to dominate AI in the next 2 to 3 years, leading to a massive expansion of GPU compute centers, thousands of gigawatts of power infrastructure, and hundreds of billions of dollars in funding, all burning wildly. This execution capability terrifies traditional Silicon Valley giants, because while they debate budgets in committees, Musk’s team has already installed racks and started training models.

$200 Billion Valuation and an Infinite Ammunition Depot

xAI’s latest valuation reached $200 billion, with Middle Eastern oil funds heavily investing. This valuation ranks just below OpenAI, but considering xAI’s much shorter founding time, its rapid valuation increase is astonishing. The Middle Eastern sovereign wealth funds’ favor toward xAI is largely due to Musk’s reputation built through Tesla and SpaceX, and his aggressive commitment to AI development.

Musk’s War Chest of Funding Weapons

1. Direct Financing Channels

· Valuation of $200 billion enables sustainable financing

· Middle Eastern oil funds provide ample capital

· Private markets highly enthusiastic about Musk’s projects

2. Collateralized Financing Capacity

· Tesla’s market cap of $1.7 trillion, shares can be collateralized

· SpaceX’s market cap of $1.7 trillion, shares can be collateralized

· Combined, they offer potential for hundreds of billions of dollars in financing

3. Speed of Capital Burn

· Cost of hundreds of thousands of GPUs

· Power infrastructure of thousands of gigawatts

· Continuous investment of billions of dollars

More critically, Musk can also leverage Tesla and SpaceX stocks for financing—both giants with a market cap of $1.7 trillion. This means even if xAI faces funding bottlenecks, Musk still has hundreds of billions of dollars in backing. This nearly unlimited ammunition depot is unmatched by competitors like OpenAI and Anthropic.

Insufficient funds? Musk can collateralize stocks. Falling behind? No worries—Musk’s work style has always been hardcore, and brute-force compute is the answer. This financial leverage gives xAI an almost unlimited supply of resources in the AI arms race.

The Personal Feud Driving the AI Holy War with OpenAI

Everyone knows Musk’s feud with Altman over OpenAI, so Musk is determined not to lose to Altman in AI development—he’s willing to risk everything. Musk is one of OpenAI’s co-founders but has serious disagreements over its direction. Musk believes OpenAI has strayed from its original non-profit mission, being hijacked by Microsoft into a commercial tool, while Altman sees commercialization as necessary for achieving AGI.

This feud is more than personal; it reflects fundamental disagreements over AI development paths. Musk advocates for open source and decentralization, whereas OpenAI, supported by Microsoft, has moved toward closed source and centralization. This ideological clash prompted Musk to create xAI, aiming to prove his vision of AI development. Musk retweeted a meme called MACROHARD, which originated from a meme image referencing his feud with Gates. Gates has been shorting Tesla, and Musk called him hypocritical, vowing to create a MACROHARD company that uses AI to wipe out Microsoft Office.

This personal rivalry-driven competition is often more intense than pure business rivalry. Musk aims not only to surpass OpenAI technically but also to crush them in compute scale. Achieving over all competitors’ combined compute power within 5 years is not just a business goal but a challenge issued to Altman and the entire AI industry.

The Violent Aesthetic of Over-the-Top Brute Force

While other AI companies focus on optimizing models, training efficiency, and inference costs, Musk chooses the simplest, most brutal approach: stacking compute. This strategy may seem lacking in technical finesse, but it is rooted in a deep understanding of AI development laws. History shows that in AI, scale often leads to breakthroughs—GPT-3 to GPT-4 is the best proof.

Wherever Musk goes, he drops a nuclear bomb—this time no exception. While Google, OpenAI, and Anthropic are cautiously planning their next-gen data centers, Musk has already announced plans to surpass all competitors’ total compute in 5 years. This declaration is not empty talk but based on the progress of the Colossus supercomputing center and the financial strength of xAI.

Hundreds of thousands of GPUs, thousands of gigawatts of power capacity, and billions of dollars in investment—these numbers are Musk’s ultimate gamble on AI’s future. If successful, xAI will become the undisputed AI compute overlord, capable of training the largest models. If it fails, it will be one of the most expensive gambles in tech history. But for Musk, not betting means losing to Altman, and that is an outcome he cannot accept.