Home Investment Anthropic seeks huge investment from Google just days after Amazon invested billions

Anthropic seeks huge investment from Google just days after Amazon invested billions

by Janessa Lee

Anthropic, a leading player in generative artificial intelligence, is reportedly in talks with investors, including Google, to secure a new $2 billion funding round. This comes on the heels of Amazon’s commitment to invest up to $4 billion in the startup last week.

The company, despite already raising billions of dollars, is seeking additional funding to further its ambitions. Anthropic is aiming for a valuation between $20 billion and $30 billion, a significant increase from its previous valuation of $4 billion. This would place Anthropic’s shares at a higher value relative to revenue compared to its rival, OpenAI.

Anthropic, a startup founded two years ago, is developing generative AI models that compete with OpenAI. Its flagship model, called Claude 2, is a chatbot with similar capabilities to ChatGPT. It can generate marketing copy, solve math problems, and engage in conversations with humans.

However, the company’s aspirations extend beyond Claude 2. Anthropic aims to build a more powerful model called Claude Next, which is so resource-intensive that existing supercomputers cannot support it. To proceed with this development, Anthropic requires substantial capital.

The high costs associated with running its AI models led Anthropic to launch a paid subscription service called Claude Pro. This service allows users to send more messages and receive priority during busy periods.

The demand for funding stems from the enormous costs associated with developing a more powerful generative AI model. Leaked documents revealed that Anthropic plans to raise up to $5 billion over the next two years to build Claude Next. This model is expected to be ten times more powerful than any existing generative AI system. To achieve this level of power, Anthropic needs access to computing infrastructure capable of delivering 10 septillion floating point operations per second (FLOPs), which is several orders of magnitude larger than current supercomputers’ performance.

To support its ambitious goals, Anthropic has secured backing from investors such as Amazon and SK Telecom. Amazon, in addition to its initial $1.25 billion investment, has an option to invest $2.75 billion more. It will also provide a significant portion of the cloud infrastructure needed for Anthropic’s operations. Amazon Web Services has been named the startup’s “primary cloud provider for mission critical workloads” and will supply its most powerful compute instances, including specialized chips designed for AI training and inference.

While nothing has been publicly announced, it is likely that Google will seek a similar level of collaboration with Anthropic if it decides to participate in the latest funding round.

Overall, Anthropic’s pursuit of additional funding reflects the immense costs associated with building advanced AI models and the importance of securing support from major cloud computing providers. With the backing of investors like Amazon and potentially Google, Anthropic aims to continue advancing its generative AI capabilities and carve out a prominent position in the industry.

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