Valuation and Investment Potential of Anthropic

Over the past two days, there has been constant discussion in the market about a batch of high-tech companies that might all rush to go public this year, and this includes OpenAI and Anthropic.

The suspense and controversy surrounding these two companies recently have remained high. Not only are they real, head-to-head competitors, but the reports about their potential IPOs have also been coming out one after another lately.

For example, just two days ago (March 31), OpenAI announced that it had once again completed a $122.0 billion round of financing. This round of financing pushed its valuation up to $852.0 billion. And after Anthropic’s previous round of financing, its valuation was only about $380.0 billion—less than half of OpenAI’s latest valuation.

Although OpenAI is extremely popular in the primary market, rumors say that in the secondary market, OpenAI’s private equity unexpectedly cooled off. About 6 institutions were in a real hurry to dump $600 million worth of their secondary-market stake, but in the end, no one took it. On the other hand, there was about $2.0 billion in capital hoping to squeeze into Anthropic, which has led Anthropic’s secondary-market quote to already exceed $600.0 billion.

In an earlier article, I publicly said that I’m relatively optimistic about the two AI companies I can understand somewhat better—one of them is Anthropic.

If OpenAI and Anthropic can really go public this year, I think the opportunities here are definitely worth paying close attention to.

First of all, the U.S. stock market is currently seeing large swings. The Nasdaq and the S&P have both pulled back by roughly 10% from their highs. If the Middle East situation can keep stirring things up for a while longer and push U.S. stock prices down even further, that would be even more ideal.

Second, besides these two AI companies, this year larger giants—such as Space X—and a whole lineup of other star companies are all waiting to rush to go public. That kind of fundraising scale will siphon away a significant amount of the market’s overall liquidity.

In this kind of environment, the IPO prices of both OpenAI and Anthropic may not be as high as previously estimated.

Finally, among OpenAI and Anthropic, I’m especially hoping that OpenAI can get to the market first, and pull out another chunk of liquidity from the AI space. That way, when it’s Anthropic’s turn to go public, its price will most likely not be too hot.

These are all qualitative analyses. Next, I’ll try again to do a quantitative analysis of Anthropic.

In Anthropic’s current revenue, its business revenue from the enterprise side (to B) accounts for four-fifths of its total revenue—actually even more—so its main source of business is applications from enterprise customers.

The U.S. is different from China. In China, enterprise users’ willingness to pay isn’t strong, but in the U.S., as long as the product is good, enterprise users’ willingness and ability to pay are strong. And once enterprise customers have gotten used to a product, they generally won’t switch easily. Some fossil-level tech companies we’re familiar with (such as IBM) have been able to keep surviving until today largely because of enterprise-side users.

Also, in the enterprise-customer market, foreign competitors generally find it difficult to enter. And Anthropic itself is a top player in this field. So once it occupies a monopoly position in the U.S. market, the entry barrier is comparatively high.

Therefore, I’m relatively optimistic about Anthropic’s model.

Over the years, Anthropic’s overall revenue has remained in a loss position. But based on its current momentum, it’s estimated that it can initially reach break-even around the beginning of two years from now (2028), and achieve net profit of around $50.0 billion by around 2030.

If we calculate from 2030, and the company can continue to operate for another 20 years, then its total net profits would be $1.0 trillion.

Based on this fairly rough and approximate estimate—if Anthropic’s market value stays within $1.0 trillion, I think the price would be fairly reasonable.