Amazon and Google Win Big From Anthropic IPO

AI Summary

Anthropic's updated IPO filing highlights the potential value of Amazon's and Google's early investments in the AI company. Amazon could theoretically hold roughly 20% of Anthropic, though its self-imposed cap limits ownership to 12%; the stake and convertible notes may deliver substantial returns if the IPO proceeds at the proposed valuation.

If you’re looking for a cheaper way of getting exposure to Anthropic than buying the stock directly, consider Amazon or Google. Anthropic’s updated IPO filing on Tuesday shows just how many shares each of those two tech giants will own in Anthropic, along with how much money they’re making on their early investments in the AI firm. Neither tech giant will own voting shares in Anthropic, so antitrust cops won’t have to worry about their influence over its management. But their stakes are significant. In theory, Amazon could own around 20% of Anthropic’s outstanding shares. But because of a self-imposed ownership cap, Amazon won’t hold more than 12% of Anthropic. The rest of its holdings are convertible notes that can convert to equity over time. Regardless, Amazon’s economic return is pretty damn good. Forgetting about the ownership cap for a minute, Amazon’s entire 20%-or-so stake would be worth about $258 billion at the midpoint of Anthropic’s proposed IPO pricing range. That’s from an investment totaling around $18.6 billion. (Anthropic’s final IPO price may well end up higher than the preliminary range, a Financial Times report tonight suggests).