Anthropic is expected to beat rival OpenAI to the public markets with a blockbuster IPO later this year despite recent doomsday warnings, but questions remain about their business models and whether regulators should step in.
Concerns about the safety of advanced artificial intelligence models escalated this month after an employee resigned from Anthropic while warning that the industry was "gambling with our lives."
Jacob Coxon, who also previously worked at OpenAI, left Anthropic last week amid a flurry of support from his former colleagues, including one who voiced concern about a small probability that AI could cause humanity's extinction.
Last weekend, Anthropic's own CEO Dario Amodei called for AI development to slow down -- but didn't say anything about the IPO.
The fracas forms a backdrop for highly anticipated initial public offerings from both OpenAI and Anthropic.
It's unclear if, or how, either company will address theoretical doomsday scenarios in securities filings, though.
Companies are required to publicly disclose known business risks to investors prior to an IPO.
Anthropic could submit that document to the Securities and Exchange Commission (SEC) as early as this month.
"Are we to believe that there is something that's extremely dangerous that's hiding inside this company because this person that quit said it, and then it was amplified by a bunch of people" who still work there, All-In podcast co-host Chamath Palihapitiya said last week.
"If it's true... (investors) will demand an enormous discount," said Palihapitiya, a venture capitalist.
Altimeter Capital founder Brad Gerstner, who has shares in both OpenAI and Anthropic, downplayed the concerns this week, arguing that an IPO brings transparency for investors.
"Anthropic will IPO. The market knows how to price risk -- see SpaceX," Gerstner posted on X.
Elon Musk's SpaceX raised a record $85 billion in its June IPO, but its stock has lost around a quarter of its value since peaking at around $202 a share.
"There is huge appetite to invest in the AI leaders," Gerstner added.
'Ill-advised'
How Anthropic's IPO performs will also set the tone for OpenAI's debut next year.
The stakes extend well beyond the two companies themselves, with tech giants including Microsoft, Amazon, Google and Nvidia holding significant stakes in the AI labs.
More broadly, the US economy is increasingly tied to the AI buildout, meaning the success or failure of these IPOs carries weight for the wider economy.
OpenAI CEO Sam Altman said this weekend that the company would delay its own IPO until 2027, citing safety concerns. It's an "ill-advised moment," Altman said.
Before the recent headlines over AI safety, Altman and executives at OpenAI had already signaled that they were in no hurry to go public this year.
The ChatGPT maker's dealmaking appears to be running full speed ahead, nonetheless.
OpenAI is in talks with investors about raising a new round of funding with a valuation of at least $1.2 trillion before it goes public, while Anthropic might seek a $2 trillion valuation in an IPO that could happen as early as October, according to various reports.
Leaders inside OpenAI have been concerned about investor skittishness, broad market uncertainty and SpaceX's underwhelming stock performance, according to media reports.
'Massive'
Also weighing on executives' minds is a proposal by both companies to slow down development, given recent incidents involving AI technology going rogue.
OpenAI CFO Sarah Friar dismissed the idea that a slowing of pace in releasing state-of-the-art technology would impact the company's core business and revenue growth.
"Even if we stop today, the amount of intelligence that's available in the world is massive," Friar told CNBC on Tuesday.
Anthropic also pushed back on the idea that being safety-minded would compromise the IPO.
"I would say safety has been the core of who we are from the very beginning," Anthropic's head of policy, Sarah Heck, said at a Politico conference on Wednesday. "Our investors know that. Our customers know that."