Amazon invested an initial $1.25bn in the generative artificial intelligence startup, Anthropic. On Monday, the tech giant said it looks to invest up to $4bn in this company as it strives to remain on the AI forefront and not in the shadow of its cloud competitors.
Amazon shows AI interest with possible $4bn startup investment
The agreement reached between the two companies stipulates that Amazon employees and Amazon Web Services (AWS) users will get early access to the latest Anthropic technologies. Anthropic, on the other hand, will primarily use Amazon’s cloud services.
Additionally, the company will train future AI models on proprietary chips supplied by the global retailer. The chief executive officers (CEOs) of both companies confirmed the immediate investment of $1.25bn and said either party could trigger an extra $2.75bn in funds by Amazon.
Neither party indicated how big a slice Amazon will have in the startup or its updated valuation after the funding. A recent estimate pegged Anthropic’s value at $4bn. Amazon did, however, say it will not occupy a seat on the board and that its role is minor.
Don’t miss out the latest news, subscribe to LeapRate’s newsletter
Experts see this move as Amazon’s response to the ongoing AI frenzy, where competitors such as Microsoft and Alphabet’s Google have introduced powerful cloud-based AI tools so far this year. It also highlights how large tech companies jump to secure bonds with AI startups, as these innovations are rapidly shaping digital environments.
Microsoft, for example, invested millions in OpenAI’s ChatGPT to give customers first access to the tool’s prose- and image-generating capacities. Likewise, Google was one of the frontrunners in the development of this AI niche and invested in Anthropic’s $450m fundraiser.
