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Investors are pouring money into Elon Musk’s xAI, but its Grok ‘undressing’ controversy is shutting women out

Emma Hinchliffe
By
Emma Hinchliffe
Emma Hinchliffe
Most Powerful Women Editor
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Emma Hinchliffe
By
Emma Hinchliffe
Emma Hinchliffe
Most Powerful Women Editor
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January 7, 2026, 12:09 PM ET
Elon Musk's xAI is raising billions—but hasn't reigned in serious problems with its chatbot Grok.
Elon Musk's xAI is raising billions—but hasn't reigned in serious problems with its chatbot Grok. Stefani Reynolds/Bloomberg via Getty Images

Elon Musk’s xAI announced yesterday that it has raised $20 billion from investors. It’s all part of the intense competition in AI, with Musk fighting to build the world’s most intelligent chatbot. Investors are so eager to get in on this opportunity, the $15 billion Musk sought rose to $20 billion by the close of the round. The company is expected to be valued at $230 billion—rising fast, even for Musk.

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It’s just another day in the AI race. But this shows where priorities lie, given that the very same day Fortune published a piece outlining a serious problem at xAI: its chatbot Grok producing non-consensual sexualized images of real people.

My colleague Bea Nolan interviewed Ashley St. Clair, a conservative political commentator, social media influencer, and mother of one of Musk’s children. (He’s questioned paternity.) She said that she became a victim of Grok’s “undressing” spree. “When I saw [the images], I immediately replied and tagged Grok and said I don’t consent to this,” St. Clair told Bea. “[Grok] noted that I don’t consent to these images being produced…and then it continued producing the images, and they only got more explicit.”

Grok produced images of St. Clair “with nothing covering me except a piece of floss, with my toddler’s backpack in the background,” she recalled. “I felt so disgusted and violated,” she said. And she felt angry this was happening to other women. She says that after speaking out publicly, multiple other women with similar experiences contacted her; she has reviewed inappropriate images of minors created by Grok; and she’s considering legal action over the images.

Musk said: “Anyone using Grok to make illegal content will suffer the same consequences as if they upload illegal content.”

Revenge porn has been a problem for years, and the rise of easily-manipulated AI tools has taken it to the next level. Yet it seems that technology is changing too fast, and the financial opportunity is too large, for fixing it to be a priority.

Women want to benefit from this enormously consequential technological shift too. But when such problems go unchecked, that becomes harder and harder. “When you are exiling women from the public dialog…because they can’t operate in it without being abused,” St. Clair says, “you are disproportionately excluding women from AI.”

Emma Hinchliffe
emma.hinchliffe@fortune.com

The Most Powerful Women Daily newsletter is Fortune’s daily briefing for and about the women leading the business world. Subscribe here.

ALSO IN THE HEADLINES

Chillhouse gets acquired. The nail brand founded by Cyndi Ramirez, which started as a salon and now has a significant business selling press-on nails,  is now owned by Kiss Beauty Group. New Beauty

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Beyoncé is the fifth musician to become a billionaire. Per Forbes, Beyoncé joins Taylor Swift, Rihanna, Bruce Springsteen, and her husband, Jay-Z, in earning a billion-dollar fortune through her music. Cowboy Carter put her over the edge. Forbes

ON MY RADAR

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Zinzi Coogler doesn't need the credit. But she's earned it Marie Claire

PARTING WORDS

"I still want to do well, but I can park it once I’m done for the day and go home and live this other life. It’s more like a job for me than the be-all and end-all." 

—Katie Leung, on returning to a major franchise with the new season of Bridgerton, years after she played Cho Chang in the Harry Potter movies

This is the web version of MPW Daily, a daily newsletter for and about the world’s most powerful women. Sign up to get it delivered free to your inbox.
About the Author
Emma Hinchliffe
By Emma HinchliffeMost Powerful Women Editor
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Emma Hinchliffe is Fortune’s Most Powerful Women editor, overseeing editorial for the longstanding franchise. As a senior writer at Fortune, Emma has covered women in business and gender-lens news across business, politics, and culture. She is the lead author of the Most Powerful Women Daily newsletter (formerly the Broadsheet), Fortune’s daily missive for and about the women leading the business world.

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