Anthropic is the next cab off the rank for mega-tech initial public offerings (IPOs), and is slated to surpass SpaceX as the biggest capital markets fundraising in history.
asserted
Anthropic → slat → history
An IPO involves a company asking big financial institutions and "mum and dad" investors for cash via the stock exchange.
asserted
IPO → involve → exchange
Elon Musk's SpaceX played this game in June, raising $US85.7 billion, with a listing price of $US135.
asserted
SpaceX → play → US135
It hit the boards of the NASDAQ and subsequently shot up to $US161, with unprecedented investor interest pushing the company to a multi-trillion-dollar valuation.
asserted
interest → hit → valuation
Prominent US analyst Dan Ives, in an interview from New York, said history was about to repeat itself with the listing of Anthropic.
asserted
history → say → Anthropic
"If you think about SpaceX obviously being the biggest IPO that we've seen this year, and this is, it's groundbreaking," the partner at Yorkville Ives said.
asserted
partner → think → Ives
"It's a watershed event, not just for tech, but the AI revolution in terms of the role Anthropic plays."
Anthropic is a self-described AI safety and research company.
asserted
Anthropic → play → role
"Anthropic is trying to pull off a historic IPO right as the AI funding well is completely running dry," fund manager Roger Montgomer said.
asserted
Montgomer → try → IPO
On a wing and a prayer
When consumers spend on credit, it's often due to a lack of cash flow.
asserted
it → spend → flow
They ask share investors (equity) and lenders (debt) for cash to operate.
asserted
They → ask → cash
The big difference is that firms will look to finance investments for future growth.
asserted
firms → look → growth
Investors, naturally, want to know they will not just get their money back but also have their investment grow over time.
asserted
investment → want → time
This usually means the company needs to be generating a profit.
asserted
company → mean → profit
SpaceX was risky in that it was operating at a significant loss when it asked share investors for cash.
But it didn't matter.
asserted
it → operate → cash
Elon Musk sold investors a dream, and the tech giant's Starlink operation acted as a much-needed cash cow for investors.
asserted
operation → sell → investors
Anthropic is in a similar position, but its CEO Dario Amodei wants even more money.
asserted
Amodei → want → money
The company is looking to raise about $US100 billion.
asserted
company → look → billion
Analysts valued Anthropic earlier this year at $US2 trillion, but a recent financial results update showed the company revalued downwards to $US1.5 trillion.
asserted
company → value → trillion
There's no problem generating revenue — the company's third quarter revenue rose to $US16 billion.
asserted
revenue → be → billion
"Anthropic's growth puts it in rarefied air," Betashares's head of investment strategy, Cameron Gleeson, said.
asserted
head → put → strategy
"Its annualised revenue run rate reportedly topped $US65 billion at the end of July, around seven times its level at the end of 2025, and many expect it to approach $US100 billion by year-end.
uncertain
it → top → end
"It has overtaken OpenAI in business adoption, where much of the potential to monetise AI lies, and achieved this with a workforce of around 5,300.
asserted
much → overtake → 5,300
"
Spending bonanza
Anthropic's costs are damaging its bottom line.
asserted
costs → damage → line
Like many big tech companies, Anthropic is building its business rapidly to meet expected demand.
asserted
Anthropic → build → demand
It means building cloud computing infrastructure, AI training chips, and data centre capacity.
asserted
It → mean → infrastructure
In the second quarter alone, it spent $US5.6 billion on computing power to run its Claude models.
asserted
it → spend → models
Adding salt to a wound, the cost of debt, which big tech companies are increasingly chasing, is becoming more expensive as inflation bears down on the global economy and interest rates rise.
asserted
rates → add → economy
The fundamental problem is that if, for example, the demand SpaceX and Anthropic's products does not justify the spending being undertaken by these companies, the entire artificial intelligence trade is at risk of collapsing.
asserted
trade → justify → collapsing
"[It's] basically playing chicken with a market where Elon Musk is warning that debt is impossible to get, over 200 over-leveraged neoclouds are going belly up, and [the failed] Firmus IPO," Roger Montgomery said.
asserted
Montgomery → play → market
In other words, the fund manager believes investors who want the huge artificial intelligence trade to keep going will invest in Anthropic or risk a Wall Street crash.
"
asserted
trade → believe → crash
I think they're trying to get ahead of the bubble possibly bursting,"he said.
uncertain
bubble → think → ?
And while Wall Street's Dan Ives is confident the IPO will be a success, he says the company has not yet produced the sort of numbers that would justify its current valuation.
asserted
that → say → valuation
"For investors, they're going to basically need to look past this year," he said.
asserted
he → go → year
"I think Anthropic, being that they're the centrepiece of the AI revolution, you're going to see probably a strong appetite for this offering."
asserted
you → think → offering
As with the SpaceX IPO, Australians will be able to apply for shares in Anthropic.
asserted
Australians → apply → Anthropic
Macquarie Capital will act as sub-underwriter and Australian coordinator for the listing.
asserted
Capital → act → listing
Dan Ives says it's up to investors to weigh up the risks.
asserted
it → say → risks
"We're all going into it.
asserted
We → go → it
Whether it's here in the US, Australia, wherever we are … we're all going into this fourth industrial revolution together,"he said.
asserted
we → go → revolution
You could argue this is modern capitalism's biggest ever test.
uncertain
this → argue → ?
…and 4 more, not listed.
The Aporia
