Google invests over $1bn in OpenAI rival Anthropic

• Published On: 22 January 2025 at 17:26

Google is investing more than $1 billion in Anthropic, an artificial intelligence (AI) startup, according to a Financial Times report published Wednesday.

This move comes after reports in January suggested that Anthropic was close to a $2 billion fundraising round led by Lightspeed Venture Partners, which would value the company at around $60 billion.

According to the Financial Times, Google's latest investment is separate from the Lightspeed funding round, demonstrating the company's continued commitment to the AI space.

Anthropic, which competes directly with OpenAI in the AI foundation model market, declined to comment on the news. Google also did not respond to enquiries outside of normal business hours.

Google's new investment builds on its existing $2 billion commitment to Anthropic. Amazon, the world's largest e-commerce company, has also increased its investment in the AI startup, doubling it to $8 billion late last year.

Anthropic, which generates approximately $875 million in annual revenue, sells access to its advanced AI models both directly and through third-party cloud services such as Amazon Web Services. AI development necessitates expensive computing power and top-tier talent, so these investments are critical for companies like Google and Amazon to maintain a competitive advantage.

The rapidly expanding AI arms race, sparked by OpenAI's release of ChatGPT in November 2022, shows no signs of slowing, with major players such as Microsoft and Amazon aggressively supporting AI firms.