Google in talks to boost investment in AI start-up Anthropic
What's the story
Google is reportedly in early discussions to increase its investment in artificial intelligence (AI) start-up Anthropic. The new funding round could value Anthropic at over $350 billion, Business Insider reported. The potential deal, which is still being negotiated, could either be a strategic investment providing more cloud computing services to Anthropic or take the form of a convertible note or priced funding round early next year.
Investment history
Google's existing stake and Anthropic's valuation
Google has already invested over $3 billion in Anthropic, giving it a 14% stake in the company. In September, Anthropic raised $13 billion at a valuation of $138 billion. This comes as OpenAI, another AI start-up, reached a valuation of $500 billion last month during a secondary sale that allowed employees to sell their shares.
Market competition
AI model race and big tech's investment divide
The news of Google's potential investment comes as Anthropic and its main rival, OpenAI, are in a multitrillion-dollar race to dominate AI models. Big Tech companies have also chosen sides in this battle, with Amazon and Google backing Anthropic while Microsoft and NVIDIA have invested in OpenAI.
Strategic alliances
Claude language models and Google's cloud computing deal with Anthropic
Founded in 2021 by former OpenAI employees, Anthropic is known for its Claude family of large language models. In October, Google and Anthropic announced a massive cloud computing deal worth tens of billions of dollars. The agreement gives Anthropic access to up to one million of Google's custom-designed Tensor Processing Units (TPUs) for machine learning workloads.
Additional support
Amazon's investment in Anthropic and its commitment to partnership
Along with Google, Amazon has also invested $4 billion in Anthropic. The company uses AWS custom chips to develop and deploy its AI models. Despite the funding from both tech giants, Anthropic remains committed to its partnership with Amazon as its primary training partner and cloud provider.