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Anthropic IPO predictions? Anthropic will be IPO'ing next week. At first it was supposed to be $2 trillion, then it collapsed all the way down to $1.1 trillion, but now I see $1.5 trillion and I bet it's higher.
I will probably try to get an allocation and then flip it immediately. Long term, I'm bullish on the frontier labs but with high variance. I can easily see a 90% decline or a 1000% increase within 3 years.
Bearish takes:
Horrible governance. Shareholders have no voting power and few rights. You are subordinate to the founders (51% voting rights), to the foundation, and to humanity in general. Even if Anthropic takes over the light cone, it will never pay a dividend.
Revenue growth has slowed. The H1 revenue growth was probably a one time thing due to token-maxxing. Will be much harder from now on and other models are "good enough" for most tasks.
Employees will be looking to cash out after IPO lockups expire.
Will the hyperscalers kneecap Anthropic? Quite possibly. Anthropic is openly competing with everyone. Why should Google, Amazon, or SpaceX rent them space? Good chance that Google and Amazon dump shares then stop renting. Elon in particular can pull the plug on their compute with 90 day notice.
If they are successful, they will be nationalized.
I would be shocked if China doesn't steal their weights. I wouldn't be surprised if they already have.
Bullish takes.
The big one. Recursive self-improvement leads to them dominating all industries. Somehow they get there before OpenAI/Google/SpaceX and the advantages compound.
People will ignore the horrible governance. It won't matter until it does and by then it won't matter. Look how long Snapchat was able to coast on the worst governance of all time (worst until now, lol).
It seems like building compute infrastructure and renting it out is possibly a better business model than renting compute to make frontier models. I don't know that these hyperscalers have that much incentive to squash their renting revenue, especially if capital/resource/legislative constraints make building more compute expensive.
Ask CoreWeave how that's going.
CoreWeave seems like an example of building compute indeed becoming too expensive, giving the advantage to Amazon/SpaceX/Google who already have a bunch of it or can build it for cheaper.
Right, there's a difference between saying you should be in the business of building compute and the business of already having it. The companies you mentioned also have other business that is actually profitable, so even if they're losing money on AI compute it doesn't affect their bottom line as much.
Do they? I haven't searched google in days. Usually it is - chatgpt do this for me.
Yes, Google is insanely profitable with operating income of $156 billion in the last 12 months (not to mention another $70 billion from gain on investments).
Google search is a cash cow. Search volume actually increased year over year, and revenue from search increased by 18%.
But Google cloud also makes vast amounts of profit, with revenue growing 100% year over year.
The one hitch is that profit is not flowing through to cash since it is being reinvested into data centers. When you build $200 billion in data centers, this is not a "loss", since you own the data center. Every year, you have to write some of it off. So it depends on what the useful life of the data centers is and whether they can be profitably employed. If they sit unused, or Google has to upgrade all the hardware on a faster schedule then anticipated, then Google will have to take large writedowns.
But given how things have transpired, I doubt that will be the case, and in fact Google's investments will be wildly profitable.
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