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Google is ramping up its commitment to artificial intelligence (AI) with a hefty $2 billion investment in AI startup Anthropic, a potential challenger to OpenAI, as reported by The Wall Street Journal.
Google Doubling Down on AI Bets
This significant investment comes after Google had already injected an initial $500 million into Anthropic, with the remaining $1.5 billion to be disbursed gradually over time, according to The Wall Street Journal’s October 27 report.
This mega-deal is an extension of Google’s earlier $550 million investment in Anthropic earlier in 2023. Moreover, Google Cloud recently struck a multiyear agreement with Anthropic valued at over $3 billion, adding more weight to this investment, The WSJ revealed.
Amazon’s Precursor
Amazon also made headlines with a colossal $4 billion investment in Anthropic in September.
Anthropic plans to allocate a substantial portion of these investments to enhance its AI systems, notably AI assistant Claude, with the aspiration of making significant strides in the AI industry.
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The Anthropic AI Rivalry
Meanwhile, OpenAI, backed by substantial funding from Microsoft since 2019, is continuously developing more advanced iterations of its AI chatbot, ChatGPT. The rapid success of ChatGPT, garnering over 100 million users within the first two months of its November 2022 launch, has drawn the attention of venture capital firms worldwide.
The co-founders of Anthropic, Dario and Daniela Amodei, had previously worked at OpenAI but left in 2021 due to disputes with OpenAI’s CEO, Sam Altman, over safety concerns linked to AI system development.
Early Backing
Before Google and Amazon’s investments, Anthropic primarily relied on funding from former FTX CEO Sam Bankman-Fried, who invested around $530 million in April 2022, approximately seven months before FTX faced financial turmoil.
A Silver Lining for FTX Creditors
Anthropic’s skyrocketing valuation provides hope for FTX creditors who anticipate full compensation amidst FTX’s bankruptcy proceedings.
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