Anthropic IPO valuation mechanics
Ben on Memes & Markets breaks down the mechanics behind AI valuations. Anthropic sat at $965 billion in May, yet Reuters says the IPO target is double that figure. Private money and firms like a16Z have spent years bidding prices up before listing. The public only gets access when companies hit their peak valuation. It raises the question of who is actually buying at those heights.
Transcript (en)
It's interesting to think about the actual mechanics of how this plays out because first it's private money, right? That's being raised. So there's technically like fewer people who really have a say in what the valuations of these companies really are. So you've got A16Z bidding up every AI company, right? To astronomical levels. And they get their buddies to invest. Ben, you've highlighted this in the past. It's like, if you don't get in now, then you won't be able to participate, right? Right. And technically, it does play in that the public is is participating to a degree, because what happens is eventually it's like we're going to have an incredibly high valuation by the time that we do go public. Right. So if you're not participating in that in this before we go public, not only just until the next round. Right. But you got to think about the public is going to want everything to do with all of this. And so leading up to the point to where you actually take the company public, you bid up the company to the highest valuation that it probably ever could be. I'm not making any claims, but I'm just saying. And then you're at the point to where the public's perception does actually matter because they're going to be putting their money in at the heights of the valuation of these companies. They're the only other money to really get access to at this point. And you've got to dump it all on someone. If you enjoyed this, be sure to hit that like button and follow to stay up to date with what's going on in the world and everything else memes and markets. Peace.
