Google continues to invest heavily in Anthropic even as it develops its own cutting-edge AI technology. The Financial Times reports that the search giant has invested an additional $1 billion, bringing its total investment to $3 billion. The funding comes as Anthropic is experiencing rapid growth, reaching annualized revenue of $1 billion in December 2023, a 10x increase over the previous year.
Important points:
Google’s investment builds on its existing 10% ownership interest in Anthropic. Anthropic has raised a separate $2 billion from investors at a valuation of $60 billion. The company’s revenue reached an annual run rate of $1 billion, a 10x increase year-over-year.
The investment reflects the growing race to develop AI, with major technology companies vying for strategic position through partnerships and investments. Google, which pioneered many of the foundational technologies used in today’s AI models, is working to stay competitive against Microsoft’s partnership with OpenAI and Amazon’s significant support for Anthropic. .
This latest funding arrives as Anthropic prepares for full-scale product development in 2025. CEO Dario Amodei outlined plans for new AI models and features, including a two-way voice chat feature and a “virtual collaborator” system designed to interact with popular productivity applications.
“I’m more confident now than at any time in history that we are much closer to strong capabilities,” Amodei told CNBC in a recent interview. He described the potential for “AI systems that can outperform almost any human at almost any task.”
The relationship between Google and Anthropic is particularly interesting given that Google is working on Gemini and other AI technologies in parallel. This complex landscape of AI development has attracted significant regulatory attention. The Federal Trade Commission is scrutinizing the relationships between big tech companies and AI startups, including Google and Amazon’s investments in Anthropic and Microsoft’s partnership with OpenAI.
Despite generating significant revenue, Anthropic, like its competitors, is not expected to achieve profitability in the near term due to the high costs of developing advanced AI models. The company differentiates itself by focusing on AI safety and attracts talent from competitors, including former OpenAI staff.
The funding environment for AI companies remains strong, with Anthropic’s total funding now reaching approximately $14.7 billion. That includes $8 billion from Amazon, which named Anthropic its leading cloud and training partner.
For Google, this investment represents more than just a financial stake; it’s a strategic move to diversify its AI portfolio and maintain its position in an increasingly competitive space.
