xAI, founded by Elon Musk, has announced the acquisition of Hotshot — a promising startup specializing in the development of artificial intelligence video generation tools comparable to OpenAI’s Sora technology.
Aakash Sastry, CEO and co-founder of Hotshot, confirmed the deal on Monday in a post on X platform: “Over the past two years, our small team has managed to develop three fundamental video models — Hotshot-XL, Hotshot Act One, and Hotshot. Training these models has allowed us to glimpse the future of global education, entertainment, communication, and productivity. We are enthusiastically ready to scale these developments on the world’s largest Colossus cluster as part of xAI!”
The San Francisco-based startup Hotshot was founded several years ago by Sastry and John Mullan. Initially, the company focused on developing AI tools for creating and editing photos, but later pivoted to creating models for generating videos based on text descriptions.
Prior to the acquisition, Hotshot attracted investments from well-known venture investors, including Lachy Groom, Reddit co-founder Alexis Ohanian, and SV Angel. The company never publicly disclosed the exact amounts of its investment rounds.
The acquisition of Hotshot may indicate xAI’s intention to create its own video generation models to compete with OpenAI Sora, Google Veo 2, and other market players. Previously, Elon Musk had already hinted at developing video generation technologies for the Grok chatbot platform. During a January broadcast, Musk stated that he expected the release of the “Grok Video” model “in a few months.”
Hotshot announced on its website that it would stop creating new videos as of March 14. Existing customers have been given until March 30 to download video materials created using the platform.
It remains unclear whether all Hotshot personnel will transition to xAI — Sastry declined to comment on this question. However, this acquisition clearly strengthens xAI’s position in the rapidly developing generative AI video segment, where competition between technology giants is becoming increasingly intense.
