Anthropic has told investors it is displeased by the prevalence of a popular kind of investment vehicle being marketed to those eager to get in on the AI boom, according to two sources with knowledge of the matter.
In its latest funding round, the AI startup is raising around $5 billion at a $170 billion valuation, Business Insider has confirmed. It told one of its largest investors, Menlo Ventures, that the venture capital firm must use its own capital and not resort to a special purpose vehicle, or SPV, as it did in a previous funding round, one of the people told BI.
The clampdown is a sign the AI startup has more leverage to dictate terms due to rampant demand for its private shares, according to the sources who asked not to be identified because they were discussing nonpublic information.
Spokespeople for Anthropic and Menlo declined to comment.
Less desirable
SPVs let investors pool their funds for a single, one-off deal. While they allow speed and can be marketed to a wider range of non-institutional investors, SPVs are generally seen as less desirable because most companies prefer to have a direct relationship with investors.
With so many people eager to invest in a limited number of AI companies, investors have been sharing stories on social media about being marketed SPVs with extremely high fees.
“Many friends including myself have been offered allocation into OpenAI or Anthropic SPVs this week,” Michelle Lim, a founder and angel investor, posted last week on X. “Minimum check sizes are $100k-$1M, with fees as high as 16%. From what I understand, folks are creating SPVs on top of SPVs and making management fees on top of them. It’s like a pyramid.”
“The feeding frenzy for ownership in the AI labs has spawned a set of bottom feeding multi layered SPV brokers that have no relationship with the company, and straight up grifters,” venture capitalist Sarah Guo wrote recently on X. “Careful of that nonsense.”
Guo was tweeting generally, not about Anthropic’s current fundraising efforts. Still, this shows how SPVs can be considered problematic, even though they’re a common tool in the venture capital toolkit.
Anthropic previously allowed SPVs
When Anthropic raised funding in late 2023, Menlo Ventures was the lead investor and stepped forward with a $500 million check.
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There was a catch, though: Half a billion dollars was too rich a sum for Menlo to use all its own capital. So part of the money came from an SPV where a pool of cash from outside investors helped fund the investment.
The SPV, revealed in regulatory filings, was an effective way for Anthropic to quickly raise a lot of money to keep up with OpenAI and other competitors.
This time, Anthropic is being more choosy, probably because there’s so much demand from investors. The startup has seen revenue soar lately, mostly thanks to its Claude models’ ability to generate, fix, and deploy software code.
Anthropic has told potential investors it wants tier-one VCs who will be with the company for the long haul, according to one of the sources who spoke with Business Insider.
Anthropic has more leverage now
Anthropic’s round is five times oversubscribed, this person added, so the company has more leverage than it did in previous funding rounds.
Menlo’s commitment in this latest round is set to be smaller, around $120 million, according to one of the other sources.
Anthropic was last valued at $61.5 billion when it raised $3.5 billion in March. Since then, investor appetite for AI has only grown more voracious.
OpenAI is reportedly seeking a $500 billion valuation in an employee stock sale, making Anthropic, even valued at $170 billion, may look like a relative bargain to some investors, in comparison.
Do you have a tip about Anthropic or another AI startup? Contact reporter Ben Bergman securely on Signal at BenBergman.11.
