xAI Buys Hotshot, a Startup Working on AI-Generated Video

Elon Musk’s AI company, xAI, has acquired Hotshot, a San Francisco-based startup specializing in AI-driven video generation. The move suggests xAI is gearing up to compete with OpenAI’s Sora and Google’s Veo 2, potentially integrating video capabilities into its Grok chatbot.

Key Points:

• xAI has acquired AI video startup Hotshot, though financial terms were not disclosed.
• Hotshot has built multiple video foundation models and previously raised funding from investors including Alexis Ohanian and SV Angel.
• The acquisition aligns with Musk’s earlier hints that xAI is working on AI video generation.
• Hotshot’s models will now be scaled on xAI’s supercomputer, Colossus.

Hotshot was founded by Aakash Sastry and John Mullan and initially focused on AI-powered image editing before pivoting to video generation. The startup developed three video foundation models—Hotshot-XL, Hotshot Act One, and Hotshot—training them on a dataset of 600 million video clips. To improve efficiency, Hotshot incorporated a neural network for automatic captioning and used the bfloat16 data format to speed up AI training.

Sastry, Hotshot’s CEO, announced the acquisition in a post on X, stating that his team is “excited to continue scaling these efforts on the largest cluster in the world, Colossus, as a part of xAI.” Colossus, xAI’s supercomputer, currently runs on 200,000 Nvidia chips and is set to expand further this year.

Musk previously hinted that xAI was developing video generation models, with a potential “Grok Video” release expected in the coming months. If xAI follows through, it could enter a competitive AI video market dominated by OpenAI’s Sora and Google’s Veo 2. While details on xAI’s plans remain sparse, integrating Hotshot’s models into xAI’s infrastructure could accelerate its move into generative video.