Elon Musk's xAI Acquires Hotshot: A Strategic Move in AI Video Generation

Elon Musk's AI company, xAI, acquires a generative AI video startup | TechCrunch

Elon Musk's AI company, xAI, has acquired Hotshot, a startup working on AI-powered video generation tools along the lines of OpenAI's Sora. Aakash Sastry, Hotshot's CEO and co-founder, announced the news in a post on X on Monday. "Over the past 2 years we've built 3 video foundation models as a small team -- Hotshot-XL, Hotshot Act One, and Hotshot," Sastry wrote. "Training these models has given us a look into how global education, entertainment, communication, and productivity are about to change in the coming years. We're excited to continue scaling these efforts on the largest cluster in the world, Colossus, as a part of xAI!" Hotshot, which is based in San Francisco, was founded several years ago by Sastry and John Mullan. The startup initially focused on developing AI-powered photo creation and editing tools, but eventually pivoted in favor of text-to-video AI models. Hotshot managed to attract investments from VCs including Lachy Groom, Reddit co-founder Alexis Ohanian, and SV Angel prior to its exit. The company never publicly disclosed the size of its funding rounds. xAI's acquisition of Hotshot could indicate that the former plans to build its own video generation models to compete with the likes of Sora, Google's Veo 2, and others. Musk has previously hinted that xAI is developing video-generating models to add to its Grok chatbot platform. During a live stream in January, Musk said that he expects a "Grok Video" model to be released "in a few months." Hotshot said on its site that it began sunsetting new video creation on March 14. Existing customers will have until March 30 to download videos they've created using the platform, the company added. It wasn't immediately clear whether the entire Hotshot staff would be joining xAI. Sastry declined to comment.

XAI acquires AI video generation startup Hotshot - SiliconANGLE

Elon Musk's xAI Corp. has acquired Hotshot, a startup that develops artificial intelligence models optimized for video generation tasks. Hotshot Chief Executive Officer Aakash Sastry announced the deal today in a post on X. The financial terms were not detailed. The company previously raised an undisclosed amount of funding from Reddit Inc. co-founder Alexis Ohanian, SV Angel and other investors. Hotshot, officially Natural Synthetics Inc., launched in 2023 with an AI-powered image generation and editing tool. The company pivoted the following year with the launch of a video generation model. The algorithm can generate 10-second clips with a resolution of 1280 by 720 pixels. The company trained its model on a dataset of 600 million clips. During the development process, it built a second neural network to automatically generate captions for those clips. Captions make it easier for AI models to understand videos, which in turn streamlines the training workflow. Hotshot configured its video generator to use the bfloat16 data format. The format makes it possible to compress 32 bits' worth of information into 16 bits, which decreases the amount of data that AI models have to process during calculations. The resulting efficiency improvements help speed up training. The video generator was trained for four months using several thousand of Nvidia Corp.'s A100 graphics processing units. That's a small fraction of the 200,000 Nvidia chips xAI has installed in Colossus, the supercomputer it uses to power its AI models. In the X post announcing the acquisition, Sastry wrote that Hotshot will "continue scaling" its video generator development efforts using Colossus. The supercomputer runs in a 750,000-square-foot Memphis facility that previously hosted a home appliance plant. The initial version of Colossus came online last September with 100,000 graphics cards. The current iteration, which includes more than 1 exabyte of storage alongside its 200,000 chips, launched three months later. Earlier this year, xAI acquired a second site in Memphis to support infrastructure upgrades. The company hopes to boost Colossus' graphics card count to 1 million by year's end. As part of the effort, xAI has reportedly held talks with Dell Technologies Inc. about buying more than $5 billion worth of AI servers.

Musk's xAI Acquires GenAI Startup Hotshot to Scale Text-to-Video Generation

The company has developed three foundational AI models -- Hotshot-XL, Hotshot Act One, and Hotshot -- that enable realistic video creation from text inputs. xAI, the AI company founded by Elon Musk, has acquired Hotshot, a San Francisco-based generative AI video startup specialising in text-to-video and text-to-GIF models. It marks xAI's first major acquisition as it seeks to strengthen video generation capabilities. The company has developed three foundational AI models -- Hotshot-XL, Hotshot Act One, and Hotshot -- that enable realistic video creation from text inputs. While the financial terms of the deal were not disclosed, the integration of Hotshot into xAI will allow the startup to scale its work using xAI's powerful 'Colossus' computing cluster, which hosts 200,000 NVIDIA H100 GPUs. Sastry expressed optimism about the acquisition, saying, "Over the past two years, we've built three video foundation models as a small team... We're excited to continue scaling these efforts on the largest cluster in the world, Colossus, as a part of xAI." Hotshot has been backed by prominent investors, including Alexis Ohanian, Lachy Groom, and SV Angel. The startup has announced that it will begin shutting down operations, allowing existing users to download their videos until March 30. While it remains unclear whether all members of Hotshot's team will join xAI following the acquisition, Sastry expressed gratitude toward his co-founder Mullan and other stakeholders for their contributions. The acquisition aligns with xAI's broader ambitions to compete with major players like OpenAI and Google in generative AI. By incorporating Hotshot's technology into its portfolio, xAI is expected to enhance its chatbot platform Grok with advanced video generation capabilities. This could enable X (formerly Twitter), also owned by Musk under X Corp, to offer users innovative features such as text-to-video creation.

xAI buys Hotshot to destroy OpenAI and Google in AI video

Elon Musk's AI company, xAI, has acquired Hotshot, a San Francisco-based startup specializing in AI-powered video generation tools, as announced by Hotshot's CEO, Aakash Sastry, on X. The acquisition aims to enhance xAI's generative AI capabilities and position it against competitors like OpenAI's Sora and Google's Veo 2. Hotshot's advancements in AI video Hotshot has developed three video foundation models -- Hotshot-XL, Hotshot Act One, and Hotshot -- over the past two years. Sastry remarked, "Training these models has given us a look into how global education, entertainment, communication, and productivity are about to change in the coming years." He expressed excitement about scaling these efforts on xAI's infrastructure, dubbed Colossus. Founded by Aakash Sastry and John Mullan, Hotshot initially focused on AI-powered photo creation and editing tools before pivoting to text-to-video AI models, reflecting a strategic adaptation to market demands. The startup attracted investments from notable venture capitalists, including Lachy Groom, Reddit co-founder Alexis Ohanian, and SV Angel, although it did not publicly disclose the size of its funding rounds. Grok 3 is here and Musk says it's 10x smarter: Is he right? Sunsetting Hotshot's services As part of the transition, Hotshot will phase out new video creation features, having begun this process on March 14. Existing customers will be able to download their created videos until March 30. It remains unclear whether Hotshot's entire team will join xAI, as Sastry declined to comment on staff changes. Musk has previously indicated that xAI is working on its own video-generating models to supplement its Grok chatbot platform. During a livestream in January, he anticipated the release of a "Grok Video" model within a few months, underscoring xAI's commitment to expanding its media generation capabilities.

Musk's xAI acquires video creation company Hotshot.co By Investing.com

Investing.com -- Elon Musk's artificial intelligence (AI) startup, xAI, has acquired Hotshot.co, a New York-based startup that specializes in creating AI-generated videos. The acquisition was announced by Hotshot on Monday, but the purchase price has not been disclosed. Hotshot, established in 2017, has backing from several investors including Lachy Groom, an angel investor, Alexis Ohanian, a cofounder of Reddit (NYSE:RDDT), and Day One Ventures. Over the past two years, the company has trained three video foundation models: Hotshot-XL, Hotshot Act One, and Hotshot. In a statement released by Hotshot, they expressed enthusiasm about the acquisition and the future of their video models. They said, "We see these video models as an early look into the future of learning, entertainment, communication and more. We're excited to continue scaling these efforts on the largest cluster in the world, Colossus, as a part of xAI." As a result of the acquisition, Hotshot announced on March 14, 2025, that they will be discontinuing new video creation. However, existing users of the platform, referred to as "hotshotters", will have until March 30, 2025, to download any videos they have previously created on the platform. Hotshot also expressed gratitude for the support they have received over the years and shared their anticipation for the future under xAI. This acquisition marks the latest step in Elon Musk's efforts to advance in the AI industry.