Musk’s X pulls in $1 billion from investors, solidifying its $44 billion valuation

Elon Musk’s social media platform X has raised almost $1 billion in new equity from investors.

This latest fundraising round brings the company’s valuation back in line with the $44 billion figure Musk set when he took Twitter private in 2022, Caliber.Az reports per foreign media. 

Musk himself participated in the equity raise, said sources who requested anonymity due to the confidential nature of the deal. One source indicated that the company may use some of the funds to reduce its remaining debt. The deal values X’s equity at roughly $32 billion. With Twitter’s original buyout including at least $12.5 billion in debt, the latest round of fundraising brings the company’s enterprise value to approximately $44 billion, the same as Musk's initial purchase price. Darsana Capital Partners, which previously acquired a portion of X’s debt earlier this year, participated in the equity round, sources noted. 

Investment firm 1789 Capital, which has previously supported Musk’s other ventures, including xAI and SpaceX, also joined the investment round. Representatives from X, Darsana Capital Partners, and 1789 Capital declined to comment on the matter. Musk has a history of seeking backing from the private markets for his ventures. This includes SpaceX, which recently completed a tender offer valuing the company at around $350 billion, and xAI, which is reportedly in talks with investors to raise funds at a valuation of $75 billion. Despite his private market success, Musk’s other major company, Tesla, has faced difficulties. 

The electric vehicle manufacturer’s stock has dropped by more than 40 per cent this year, partly due to concerns over Musk’s political prominence, which has alienated some consumers. Additionally, Tesla faces growing competition, with shares dipping 5.3 per cent following news that Chinese automaker BYD Co. unveiled an electric car that can be charged as quickly as a gasoline vehicle. Since Musk’s acquisition of Twitter, now rebranded as X, the company has experienced a turbulent period, marked by layoffs and a significant loss of advertisers. 

X’s advertising business suffered a blow shortly after Musk took over, as many advertisers paused or stopped spending, fearing their ads could appear alongside inappropriate content. Musk has taken legal action against these advertisers, suing several major brands for withholding ad spending, accusing them of anti-competitive behavior. Although some advertisers have begun to return, industry insiders suggest that Musk’s legal threats could be influencing their decisions.

Additionally, Musk’s role within the Trump administration has raised concerns among marketers who fear alienating the billionaire. Despite these challenges, X’s business has shown signs of recovery since Donald Trump’s re-election. However, Fidelity Investments, a major investor in X, wrote down its stake in the company by 68 per cent as of January. Recently, bankers also sold X debt they had been holding since Musk’s initial acquisition.

By Naila Huseynova