From Business Insider · Ben Bergman · · 3m
Menlo Ventures bets $25 billion on Anthropic IPO
An early investor in the AI startup shrugs off massive losses and competition, but the market is less convinced.
In brief
An early investor in the AI startup shrugs off massive losses and competition, but the market is less convinced. Menlo Ventures partner Matt Murphy remains bullish on Anthropic's IPO despite the company's eight billion dollar operating losses, but investors at a San Francisco event showed little appetite for the stock…
Menlo's massive Anthropic bet
Menlo Ventures partner Matt Murphy is an early investor in Anthropic. If the IPO succeeds at a two trillion dollar valuation, Menlo's estimated one billion dollar investment becomes around twenty five billion dollars.
Eight billion in losses
Reuters obtained leaked financials showing Anthropic racked up an eye-watering eight billion dollars in operating losses last year. Murphy said investors should wait for the company's S-one before judging the business.
Murphy remains bullish
Despite the losses, Murphy said he remains extremely bullish on Anthropic. When asked if he could invest more, he said: if I could buy more, I would.
“If I could buy more, I would.”
Chinese competition dismissed
Murphy pushed back on the idea that Chinese open-weight models will commoditize the biggest AI labs. He argues the market has moved beyond experimentation into optimization and cost-cutting.
Infrastructure is the bet
Menlo is betting heavily on the infrastructure layer: compute, inference, routing, and optimization. Murphy said this has accounted for roughly sixty to seventy percent of the firm's AI investments.
No next Anthropic coming
When asked about finding the next Anthropic, Murphy was blunt: I don't think there's going to be another Anthropic.
“I don't think there's going to be another Anthropic.”
OpenAI is overhyped
Asked which company was most overhyped right now, Murphy didn't hesitate: Definitely OpenAI, he said with a grin. This was Anthropic's biggest rival.
“Definitely OpenAI.”
Audience skepticism on valuation
The Tech Insider audience of investors and founders was less bullish on Anthropic.When asked how many would invest at a three trillion dollar valuation, the response was tepid, with most saying they would not buy.
Washington University warns of trouble
The head of Washington University's endowment warned that AI labs are in major trouble because of competition from Chinese models. He said he has gotten more skeptical over time about AI valuations.
Khosla defends American AI
Early OpenAI investor Vinod Khosla strongly disagreed with the skeptics, telling Ben that OpenAI and Anthropic have a huge cost advantage in chips and data centers over Chinese competitors.
Investors split on AI future
Most investors remain highly bullish on American AI, particularly Anthropic and OpenAI, but many privately voice skepticism about ballooning valuations in the broader AI ecosystem.
The headline
Menlo Ventures partner Matt Murphy remains bullish on Anthropic's IPO despite the company's eight billion dollar operating losses, but investors at a San Francisco event showed little appetite for the stock at higher valuations.
