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Today on the podcast, I want to be breaking down a whole bunch of news related to one of our favorite AI startups, Anthropic, because they have floated raising money at a $40 billion valuation. They also have some big news about their $4 billion deal with Amazon that has recently passed. You know, some of the antitrust scrutiny over in the uk There's a lot that goes down to the whole antitrust thing, and I think we've seen a bunch of AI companies get caught up in it. There's a bunch of pending cases, and I think it's going to be a very big thing in the future. So I want to actually break this thing down in a little bit more detail, essentially what's happening with Anthropic there. But you'll also get a lot about the entire industry and what you're going to see with other places. Before I get into all of that, I wanted to say that today's episode is sponsored by my very own school community. Not really sponsored, I'm just telling you about it. If you're interested in starting your own AI side Hustle, using AI to make, make money or grow your business, scale your business that you already have using AI tools, you need to join my AI school community. It's called AI Hustle. I would love to have you be a part of it. Every single week, I share exclusive content, then I'll share anywhere else. Videos where I break down exactly what tools I'm using, exactly what products I'm selling, how I'm making money, how much money I'm making, all with AI that I don't share public anywhere else. Every single week, there's exclusive content there. I already have a backlog of over a dozen exclusive videos, a couple courses, amazing stuff, and of course, an amazing community that will comment on whatever you're working on, give you feedback, share ideas. It's an amazing group of people. We have over 150 people in the group and I would love for you to be one of them. It's $20 a month. Actually, I think less. $19 a month. It's going to be $100 in the future, a month, but it's at a discount right now. So if you're interested, I would love for you to join. I think you're going to get a ton of value out of it and I'm excited to see what you're building in AI and drop my comments on whatever you're working on. So back to Anthropic. The thing that I think is really interesting here, the Information kind of broke the story. They always have these exclusive takes. This one is the fact that Anthropic, which of course is OpenAI's biggest competitor, they're talking to a bunch of different investors raising money, and their latest valuation is 30 to 40 billion dollars. Now this is pretty interesting because OpenAI is just closing out their current funding round at 150, 50 billion dollars. So even if they got the higher end of this scale at $40 billion, you know, there's still more than three times smaller or lower evaluation than OpenAI. And I guess that makes sense because Anthropic definitely isn't as big as OpenAI. They don't have. They're not as robust as far as all the products they offer. But as far as the Chat GPT competitor side, very, very competitive. I know a ton of people that have both Chat GPT and Anthropic. Some people that only use Anthropic, a lot of people tell me it is way better for development. Um, I have a lot of people that use it for marketing that say the tone of Anthropic is a lot better for getting just text and content generated. So Anthropic is definitely a really big player. Um, now for those that are like, forget where Anthropic kind of came from. It was the CEO of Anthropic had a falling out with Sam Altman from OpenAI about three years ago and started the company, left OpenAI and started and started Anthropic and, and you know, started creating cloud and all of the other different tools after that. So very, very interesting. What I do think is like, interesting with this is the way that they're going about or trying to raise this money. So based off of some of some documents that the information saw, it looks like Anthropic is going to be kicking off this fundraise in a little bit of a unique way. They're going to be presenting to some investors at Morgan Stanley's private tech conference in Los Angeles. That's going to be next month. And what's interesting to me about that is typically this is not the way that startups go raise money. You know, they usually go to venture capital firms and other places. They don't usually go to investment banks when they're looking to get in, you know, investments. Unless it's really, really complex how the round has been put together. Now this is, you know, something that you could imagine having sovereign wealth funds or a bunch of corporate investors in. Those are kind of the more complex types of rounds. And this is exactly what I believe Anthropic is doing. So in the past, they've raised a lot of money from corporate, right? They've got $4 billion from Amazon, which I'm going to talk about in a minute because that is also an interesting story. And of course, they've got $2 billion from Google, a bunch of other. A bunch of other places that they've been raising money from. So I believe, based off of this, and it looks like what they're saying is they plan on continuing to raise money from corporate investors again. Now, all of this to me is very, very interesting because the way they do a lot of these corporate deals is that, you know, they've done deals with Google Cloud where they got free compute. They've done deals with Amazon where they're also getting compute. So, you know, a lot of this could be doing it with corporate people where they're like using it to lower their cost of goods. But in any case, all of this goes towards training their Claude chatbot, which then of course, they have subscriptions that kind of pay for that. So really interesting. Fundraise will be interested. I'll be really interested to see all of this. Of course, this is not very cheap. By the end of this year, Anthropic is set to be generating about $800 million in annualized revenue by the end of this year, meaning it's not actually going to have generated $8,800 million, but by the end of the year, it will be on Track to generate $800 million by the end of its next 365 days. So kind of sneaky how to do that. Or about $66 million in revenue per month. So in any case, this is pretty fantastic. It shares a big chunk of that with Amazon, which also resells the cloud model to a lot of its cloud customers. And I think Anthropic net revenue after the payout that they do to Amazon is probably 25, 50% lower than, you know, the numbers that I was just mentioning before. So all of this comes at a pretty steep cost. The company previously projected that it was going to burn more than $2.7 billion this year. So it sounds fantastic that they're going to be on track to make 800 million. But spending 2.7 billion is a lot of money. Absolutely insane numbers. So it's going to be interesting to see where this goes now in relation to that whole deal. There's other news coming out around that whole Anthropic Amazon deal. Apparently that deal has just been cleared by a UK antitrust authority. That said Amazon's partnership and equity investment in Anthropic can't be investigated under the current merger rules because of the size and scope of the deal. So that's something that TechCrunch put out. Talking about it. Now I want to talk about what's specifically interesting with this case and why that is so a lot of these are coming out of the CMA. This is the UK's Competition and Markets Authority. What's interesting is this is six months after anthropic and Amazon announced that they were going to be doing this deal. And you know, even further back in the past when Anthropic really started working with Amazon AWS and making deals. But then this like really big $4 billion deal was about six months ago. So six months later we have this UK antitrust people say, oh no, it's good, you guys are good to do this. Like, would they really have changed things? They've already been taking money, they've already been growing. I don't know. To me it just seems crazy like this uk, you know, antitrust group or whatever wants to just put a stamp of approval on it just to say that, look, we have a say. You gotta like think about us, whatever. In any case, the reason why this is so important is because Anthropic is not even based in the uk, it's a San Francisco based startup. Amazon is also a USA based company. And I guess the reason why the UK concluded that it was that they didn't actually say like, hey, we think like your deal is good. They just said we can't investigate your deal. And the reason for that is because that it didn't meet the 70 million or yeah, the 70 million euro threshold to qualify for investigation. And that's specifically their UK turnover, meaning in the United Kingdom they're not making more than that. So they don't really get to do that. It's kind of interesting to me though because it's a very, I believe it's the same one or a similar UK agency that blocked Adobe from acquiring Figma and that was a multi billion dollar deal that got completely blocked and shut down. Adobe was not able to acquire Figma and that wasn't even because like in the United States there was regulatory things. Even though Figma and Adobe are both USA based, it was because of some group in the UK that blocked it. So to me this is very, very fascinating that it's, you know, company or you know, agencies in the UK that are blocking United States tech companies. From doing mergers and stuff. It's a very, very tricky time. And so because of that, because of that Adobe and Figma deal that got blocked, now all of these companies are essentially doing acqui hires. So you see with Microsoft, they essentially came in and instead of just straight up buying, they just went and paid a chunk of change to get inflections. Whole team for the, you know, that had raised a billion dollars and Mustafa Selliman and kind of their leadership. So very, very interesting time right now. But all of this is kind of switching the way that these deals are done. People are investing aqua hiring, but they're not straight up doing acquisitions anymore. So very, very interesting. But in any case, Anthropic has been cleared of this Amazon deal. They're not going to get investigated on it. And it looks like smooth sailing for them to go and try to raise their $40 billion. To keep you updated on all of that, if you're interested in making money from AI tools or growing your business, make sure to join our school community AI Hustle. Their link is in the description and I will catch you next time.