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Google Augments AI Rivalry with $2 Billion Investment in Anthropic, Amazon Follows Suit

Before this investment, Google had already cemented a deal with Anthropic concerning Google Cloud, valued over $3 billion.

Google Augments AI Rivalry with $2 Billion Investment in Anthropic, Amazon Follows Suit

Google has recently committed to an investment of $2 billion in AI startup Anthropic, a rival to OpenAI, following its earlier investment of $550 million, marking a financial endorsement to the budding enterprise. This new influx of funding, structured as a convertible note, could transition into equity in Anthropic during the subsequent funding round, as reported by Bloomberg, citing Anthropic as the source. The report delineates Google’s prior investment of $500 million and a future commitment of an additional $1.5 billion.

Before this investment, Google had already cemented a deal with Anthropic concerning Google Cloud, valued over $3 billion, as disclosed by the Wall Street Journal. This multi-year accord was inked a few months preceding the recent investment.

Parallelly, Amazon has expressed its financial backing by pledging an investment up to $4 billion to fortify its standing against other cloud companies in the AI domain. In a recent filing with the US Securities and Exchange Commission, as quoted by Reuters, Amazon elucidated its investment of $1.25 billion in Anthropic, which could transition into equity. The opportunity to invest a further $2.75 billion in a second note is set to expire in Q1 2024.

Anthropic was conceived by siblings Dario and Daniela Amodei, erstwhile engineers at OpenAI, post a discord with OpenAI CEO Sam Altman regarding the secure development of artificial intelligence. The duo ventured into creating their own company in 2021, embarking on a mission to advance the realm of AI technology.

Following a setback with previous funding from FTX’s Sam Bankman Fried, Anthropic broadened its investor horizons, aligning with cloud entities like Amazon and Google, as well as traditional Silicon Valley investors like Spark Capital and Menlo Ventures, as mentioned in the Wall Street Journal report.

Anthropic, home to a generative AI-based chatbot named Claude akin to OpenAI’s ChatGPT, necessitates funding to cultivate more advanced AI systems. With $7 billion secured in funding this year alone, the startup is on a trajectory toward achieving its goals.

Amidst the escalating competition among Big Tech companies to integrate AI into their frameworks, this notable investment by Google and Amazon in Anthropic underscores the role of AI startups in shaping the future of the technology sector.

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