xAI has secured $10 billion in funding to develop what it aims to be the world’s largest data center. This total includes a $5 billion debt deal led by Morgan Stanley, which was oversubscribed and involved global investors, alongside a separate $5 billion strategic equity investment. Concurrently, Surge AI, a competitor to Scale AI in the data labeling sector, is preparing to raise up to $1 billion in its first capital round, targeting a valuation exceeding $15 billion. Surge AI reported over $1 billion in revenue in 2024 and is notable for being profitable and bootstrapped without venture capital funding. Scale AI, which Meta invested $14.8 billion to acquire a 49% stake in, reported $870 million in revenue and has recently experienced customer losses. The data labeling market is projected to grow from $3 billion in 2023 to $29 billion by 2032, with Surge AI positioning itself as a significant player alongside Scale AI.