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Back to Anthropic S-1 Shocker, Greatest Business Ever? Google's $500B Wipeout, Midterm Predictions.

Why Does the AI Complex Compete With Treasuries?

Chamath Palihapitiya says the AI complex has gotten so big that it now competes with US treasuries, so somebody is going to have to pay more.

At 1.4, 1.5, or 1.6, the Anthropic IPO is priced fairly, with no deal and only an entry price into the future, so a buyer needs a view on two risks. The first risk is revenue composition: how long it takes Anthropic to show 10,000 customers the ROI math to move from less than a million to single digit millions to tens of millions. Defensible use cases, white papers, and analyses make it straightforward for corporate infrastructure and a multi-person executive team to sign off on a multi-million dollar spend. The customer risk can be checked quarter after quarter and priced.

The second risk cannot be priced. Treasuries have to compete with Facebook, SpaceX, Anthropic, and OpenAI for money. If the hyperscalers have to pay more because people believe the flight to quality and the durational risk of the government is better, the money the hyperscalers, the AI complex, Anthropic, and OpenAI raise comes in at a higher coupon. David Friedberg's chart then holds, the rates cascade through the ecosystem, the neoclouds pay more, and the risk of defaults gets pulled forward.

Grokipedia·Chamath Palihapitiya·David Friedberg

Transcript

Anthropic S-1 Shocker, Greatest Business Ever? Google's $500B Wipeout, Midterm Predictions ·

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More from this episode

  1. What Does Anthropic's S-1 Reveal?Jason Calacanis says Anthropic's S-1 targets a $100 billion public offering, large enough to pass SpaceX and rank as the largest ever.
  2. Is Anthropic's $80 Billion Loss Real?David Sacks says the widely reported $80 billion Anthropic loss is a phantom number, not a cash loss.
  3. How Does One Nvidia Dollar Become $18?David Friedberg says a dollar Nvidia spends turns into $18 that Anthropic makes selling to customers.
  4. How Did Microsoft Nearly Double Revenue?Chamath Palihapitiya says Microsoft's revenue went from $198 billion to $332 billion in the last four years while staff increased by only 2,000 people.
  5. What Is Anthropic's Biggest Risk?Chamath Palihapitiya says Ant's biggest risk is compute, and the biggest piece of that problem is data centers, then the financing commitments, then power.
  6. How Big Can Anthropic Revenue Get?Chamath Palihapitiya says Anthropic can become a revenue business in the hundreds of billions of dollars within about three to seven years if it reaches 25 or…
  7. How Much Debt Does the AI Complex Owe?Chamath Palihapitiya says the AI complex now owes $340 to $400 billion to the market, and the entire United States economy is levered to that complex.
  8. Why Will Governments Regulate AI Compute?David Friedberg argues that governments will regulate AI compute and assign who gets access to how much of it.
  9. What Revenue Targets Did Anthropic Lay Out?Jason Calacanis says Anthropic's targets put revenue at 100 billion dollars, then 300 billion, and eventually 600 billion.
  10. Why Do Companies Block AI at Work?Jason Calacanis says Gallup still has frequent and daily AI use at work at about 10% and 20%.
  11. Why Did Google Lose $500 Billion?Jason Calacanis says Google lost about $500 billion of market cap on Thursday, falling 10 to 15 percent, after Q3 earnings missed search revenue for two…

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