Google will invest up to $40 billion in Anthropic in cash and computing

Google plans to invest up to $40 billion in Anthropic and support the AI ​​company’s growing computing needs, reports Bloomberg. The Alphabet subsidiary is committing to invest $10 billion now, at a $350 billion valuation for Anthropic, with another $30 billion to follow if Anthropic meets certain performance targets, according to Anthropic.

The investment pledge comes after Anthropic launched its latest model, the Mythos, to a limited group of partners this month. Anthropic says the Mythos is the company’s most powerful model to date and has important cybersecurity applications. Because of potential misuse, Anthropic has restricted wider access while working with select organizations to assess and address these risks — though the model has already fallen to unauthorized hands. It is also likely to be expensive to run at scale.

The AI ​​race is increasingly defined by access to the computing needed to train and develop these systems. OpenAI has moved aggressively to secure this capacity through a network of multi-hundred billion dollar deals between cloud providers, chip and power suppliers, including a extended its deal with chipmaker Cerebras this month.

Anthropic has entered a fight of its own. The company has faced extensive complaints on Claude usage limits in recent weeks and responded with a series of infrastructure deals. Earlier this month, Anthropic made a deal with cloud computing provider CoreWeave for data center capacity. Also this week it secured an additional $5 billion in investment from Amazon, part of a broader deal in which Anthropic is expected to spend up to $100 billion on about 5 gigawatts of computing capacity over time.

While Google is a direct competitor in AI models, it is also a key infrastructure supplier for Anthropic. Anthropic relies heavily on Google Cloud for chips and infrastructure, including access to Google’s tensor processing units (or TPUs), which are specialized chips designed for AI workloads and considered among the best alternatives to Nvidia’s on-demand processors.

Anthropic’s relationship with Google predates this week’s news. Earlier this monthAnthropic announced a partnership with Google and chipmaker Broadcom, which designs custom AI chips for Google, to access multiple gigawatts of TPU-based computing capacity by 2027. A later Broadcom filing put that amount at 3.5 gigawatts.

Google’s new investment expands this arrangement, with Google Cloud now providing 5 gigawatts of new capacity over the next five years, with scope for further scaling.

Anthropic’s valuation was $350 billion as recently as February. Investors have since been willing to back the company to $800 billion or more, according to Bloomberg. The company is also reportedly considering an IPO as early as October.