Amazon to invest up to $4 billion in AI startup Anthropic

Amazon said Monday it has agreed to invest up to $4 billion in AI startup Anthropic as the e-commerce group steps up rivalry against Microsoft, Meta, Google and Nvidia in the fast-growing red hot sector that many technologists believe could be the next great frontier.

The e-commerce group said it will initially invest $1.25 billion for a minority stake in Anthropic, which like Google’s Bard and OpenAI, also operates a generative AI chat platform. As part of the deal, Amazon has an option to increase its investment to a total of $4 billion in Anthropic, Amazon said.

TechCrunch reported exclusively earlier this year that Anthropic, which also counts Google as an investor, had planned to raise as much as $5 billion over the next two to three years.

As part of a deal with Amazon, Anthropic will use AWS as a primary cloud provider for mission critical workloads, including safety research and future foundation model development, the e-commerce group said. Anthropic will additionally use AWS Trainium and Inferentia chips to build, train, and deploy its future foundation models.

“We have tremendous respect for Anthropic’s team and foundation models, and believe we can help improve many customer experiences, short and long-term, through our deeper collaboration,” said Andy Jassy, Amazon chief executive, in a statement.

“Customers are quite excited about Amazon Bedrock, AWS’s new managed service that enables companies to use various foundation models to build generative AI applications on top of, as well as AWS Trainium, AWS’s AI training chip, and our collaboration with Anthropic should help customers get even more value from these two capabilities.”

Anthropic, which also counts Spark Capital, Salesforce, Sound Ventures, Menlo Ventures, and Zoom among its backers, has now raised a total of $2.7 billion. It was valued at about $5 billion in May this year when it secured $450 million.

More to follow.

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