Artificial Intelligence (AI) startup Anthropic is set to test investor enthusiasm for the AI boom as it prepares for a mega Initial Public Offering (IPO), aiming for a valuation of up to $1.4 trillion. The company, parent to Claude, has attracted significant backing from tech giants such as Amazon, Google, Nvidia, AMD, and others, who have collectively invested billions. The shares will debut on the Nasdaq Global Select Market on November 19 under the ticker symbol ANT. However, concerns have arisen over the potential risks associated with AI and the speed at which companies can convert spending into profits.
Anthropic's IPO details reveal a proposed valuation of up to $1.4 trillion, with a price range of $70-$78 per share, aiming to raise up to $64.4 billion. Additional funds may come from a private placement with cornerstone investors, potentially bringing in an extra $26 billion. If priced at the top end of the proposed range, Anthropic could be valued at around $1.4 trillion on a fully diluted basis, though excluding securities, its valuation would be close to $1 trillion.
Some of Anthropic's key technology backers include Amazon, Google, Microsoft, Nvidia, AMD, and Broadcom, who have collectively committed billions in investments and purchases of non-voting shares. The company has also received backing from venture capital firms like Spark Capital, Lightspeed Venture Partners, Fidelity Management & Research, among others.
However, despite this impressive backing and rapid growth in demand for its Claude models, Anthropic has yet to turn a profit. Its expansion requires enormous computing capacity, with nearly $900 billion in computing commitments with partners like Amazon and Google's parent company Alphabet. The IPO proceeds could provide the company with significant funds to accelerate its expansion, but the risks associated with AI remain a concern for potential investors.