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Anthropic raises $13B Series F

anthropic.com

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Re: Anthropic raises $13B Series F

#601

Post by tim333 »

sdesol wrote: post #257
jononor wrote: post #133

Earlier quoted context omitted.

It is being played like a winner-takes-it-all right now (it may or may not be such a market). So it is a game of being the one that is left standing, once the others fall off. In this kind of game, speeding more is done as a strategy to increase the chances of other competitors running out of cash or otherwise hitting a wall. Sustainability is the opposite of the goal being pursued... Whether one reaches "AGI" is not…

> So it is a game of being the one that is left standing Or the last investor. When this type of money is raised, you can be sure the earlier investors are looking for ways to have a soft landing.

I'm not sure many investors are investing their own money. They are investing other people's money, maybe owned by shareholders of large companies in turn owned by our pension funds.

Re: Anthropic raises $13B Series F

#602

Post by filoleg »

rich_sasha wrote: post #576
simianwords wrote: post #328

Earlier quoted context omitted.

SV playbook has been to make sustainable businesses. Uber makes profits, so do Google, Amazon and other big tech. > LLMs are amazing but I'm not sure they justify the astronomical training capex, other than as a stepping stone. They can just... stop training today and quickly recuperate the costs because inference is mostly profitable.

All these businesses looked incredibly unsustainable for a long time. Uber was a cash shredder. Amazon didn't turn a profit for years, IIRC. They became profitable essentially by becoming quasi-monopolies. Indeed, LLM companies likely turn operating profits, but I'm not sure that alone justifies their valuations. It's one thing to make money, it's another to make a return for investors. And sure, valuations are growi…

Cannot speak for the rest, but the whole “Amazon didn’t turn a profit for years” (as an argument about their profitability now coming solely through quasi-monololy routes) is incredibly misleading and bordering on disingenuous.

Since before AWS was even a thing, Amazon was already turning up great revenue and could’ve easily just stopped expanding and investing into the company growth, and they would be profitable easily. Instead, Amazon decided to reinvest all their potential profits into growth/expansion (with the favorable tax treatment on top) at the expense of keeping the cash profits. At any given point, Amazon could’ve stopped reinvesting all potential profits into their growth, and they would be instantly profitable.

This is not the same as Uber, which ran their core service operations at a net loss (and was only cheap due to their investors eating the difference and hoping that Uber will eventually figure out how to not lose money on operating their core service).

Re: Anthropic raises $13B Series F

#603

Post by utyop22 »

xpe wrote: post #150
code4tee wrote: post #65

Impressive round but it seems unlikely this game can go on much longer before something implodes. Given the amount of cash you need to set of fire to stay relevant it’s becoming nearly impossible for all but a few players to stay competitive, but those players have yet to demonstrate a viable business model. With all these models converging, the big players aren’t demonstrating a real technical innovation moat. Every…

> Everyone knows how to build these models now, it just takes a ton of cash to do it. This ignores differential quality, efficiency, partnerships, and lots more.

Maybe in enterprise.

But in the consumer market segment, for most cases, its all about who is cheapest (free preferably) - aside from the few loonies who care about personality.

The true lasting economic benefits within enterprise are yet to play out. The trade off between faster code production vs poorer maintained code is yet to play out.

Re: Anthropic raises $13B Series F

#604

Post by cjbgkagh »

mlyle wrote: post #537
cjbgkagh wrote: post #474

Earlier quoted context omitted.

That’s like being upset that you can’t dig your own suez canal. So long as there is competition it’ll be available at marginal cost. And there is plenty of innovation that can be done on the edges, and not all of machine learning is LLMs.

> So long as there is competition it’ll be available at marginal cost. Most things are not perfect competition, so you get MR=MC not P=MC. We're talking about massive capital costs. Another name for massive capital costs are "barriers to entry".

Granted that capital costs are a barrier to entry and that barriers to entry leads to non-perfect competition, but the exploitability is limited in the case of LLMs because they exist on a sub-linear utility scale. In LLMs 2x the price is not 2x as useful, this means a new entrant can enter the lower end of the market and work their way up. The only way to prevent that is for the incumbent to keep costs as close to marginal as possible.

There is a natural monopoly aspect given the ability to train and data mine on private usage data but in general improvements in the algorithms and training seem to be dominating advancements. Microsoft's search engine Bing paid an absolute fortune for access to usage data and they were unable to capitalize on it. LLMs have the unusual property that a lot of value can be extracted out of fine tuning for a specialized purposes which opens the door to a million little niches providing fertile ground for future competitors. This is one area where being a fast follower makes a lot of sense.

Re: Anthropic raises $13B Series F

#605

Post by sdesol »

tim333 wrote: post #601
sdesol wrote: post #257

Earlier quoted context omitted.

> So it is a game of being the one that is left standing Or the last investor. When this type of money is raised, you can be sure the earlier investors are looking for ways to have a soft landing.

I'm not sure many investors are investing their own money. They are investing other people's money, maybe owned by shareholders of large companies in turn owned by our pension funds.

It might not be their money, but they are paid a management fee and if they cannot provide some return, people will stop using them.

Re: Anthropic raises $13B Series F

#606

Post by rich_sasha »

filoleg wrote: post #602
rich_sasha wrote: post #576

Earlier quoted context omitted.

All these businesses looked incredibly unsustainable for a long time. Uber was a cash shredder. Amazon didn't turn a profit for years, IIRC. They became profitable essentially by becoming quasi-monopolies. Indeed, LLM companies likely turn operating profits, but I'm not sure that alone justifies their valuations. It's one thing to make money, it's another to make a return for investors. And sure, valuations are growi…

Cannot speak for the rest, but the whole “Amazon didn’t turn a profit for years” (as an argument about their profitability now coming solely through quasi-monololy routes) is incredibly misleading and bordering on disingenuous. Since before AWS was even a thing, Amazon was already turning up great revenue and could’ve easily just stopped expanding and investing into the company growth, and they would be profitable ea…

Ok, we can debate on Uber, but your take on Amazon is very similar to today's LLM providers. They too are making good revenue on their product, but put so much cash into growth that they at least appear to be running at a loss.

Re: Anthropic raises $13B Series F

#607

Post by rsynnott »

rsynnott wrote: post #596
arduanika wrote: post #195

Earlier quoted context omitted.

It is probably just a coincidence, but it's darkly funny how well this lines up with the strategy described in a rather infamous LessWrong post. The title is "Solutions to the Altruist's burden: the Quantum Billionaire Trick", but you probably know it by a different name. The author is one Roko Mijic.

Probably not a total confidence; it’s EA/rationalist theory taken to ludicrous extremes in both cases.

*coincidence

Re: Anthropic raises $13B Series F

#608

Post by Eiriksmal »

Zigurd wrote: post #251
Zigurd wrote: post #72

Substitute fiber and routers for GPUs and this starts to look familiar.

I am old enough to have had the pleasure of Atiq Raza telling me the thing I was helping pitch couldn't be sold to Avaya (or was it Cisco?) in four months for $1 billion and so is not interesting, within the first four minutes of the meeting. Evidently he was seeing enough pitches for things he could sell at that price and in that time. Now he's in AI investments.

https://www.sec.gov/enforcement-litigation/litigation-releas...

A fascinating investor. I just finished re-reading Microserfs. The buzzwords may have changed between 1993 and 2025, but the human behaviors certainly have not.

Re: Anthropic raises $13B Series F

#609

Post by harmmonica »

alluro2 wrote: post #520
harmmonica wrote: post #444

Earlier quoted context omitted.

Big question is whether it replaces and then doesn't create new opportunity to make up for those casualties. I'm not sold on this, but there's this part of me that actually believes LLM's or perhaps AI more broadly will enable vast numbers of people to do things that were formerly impossible for them to do because the cost was too great, or the thought of doing it too complex. Now those same things are not only acces…

I'm genuinely curious about how you and other people with similar outlook see this playing out, as it would kind of provide hope. Scenario: You are a medium level engineer, who got laid off from a company betting on AI to replace a significant portion of their junior/medium level developers. You were also employing a middle-aged woman, to help with the kids after school and around the house, until you and your wife c…

I totally share your concern, but I think there's reason for hope assuming it's not Terminator-style AGI that destroys the world (bigger problems than unemployment in that case). Specific to your scenario, it seems like companies are laying people off today in the name of AI efficiency gains (that in itself is debatable, but let's assume that is why they're doing it--they think they can do the same if not more with less). But if you play out those same efficiency gains companies that are in growth mode ought to be able to use those efficiency gains to accelerate product development. So instead of laying people off, companies will be able to build product that much faster because their employees, and engineers in particular, can move so much more quickly. We're so early, though, and c-suite folks are so myopic that the troops haven't yet had time to show them that revenue growth is the real prize of AI/LLM's (and believe me it's always the some troops that show them the way).

On a larger level, I would just ask your fictitious medium-level engineer what are they able to do today, with an AI/LLM, that they were unable to do before? As a very basic example, and one that is already true with existing LLM's, a mid-level engineer who wanted to build an app might've formerly struggled with building a UI for their app. Now, sans designer, a mid-level engineer can spin up an app UI much more quickly, and without the labor of finding and actually paying a designer. That's not to say there's no value left in design, but if you're starting out it's similar to how bootstrap (dating myself here) was an enabler because you were no longer in need of a designer to build a website (was still a huge time suck and pain in the ass though). You can multiple that by a bunch of roles and tasks today because LLM's make it possible to do things you just formerly wouldn't have been able to do on your own.

Last thing is the much more high level. Every time some new tech is introduced there's a lot of concern about displacement. I think, again, that's valid and perhaps moreso with AI. But it does seem to me like major new tech always seems to create a lot of opportunity. It might not be for the exact same people like your mid-level engineer (although I think it might for him/her), but I stay hopeful that the amount of opportunity created will offset the amount of suffering it will cause. And I don't say that in some kind of "suffering is ok" way, but just like revenue growth is the be all end all for so many companies, tech brings change and some suffering is a part of that. Prior skills become less important, new skills are preferred. Some folks adapt. Others thrive. Some are left behind.

If you're still checking in on this thread, and you actually read my diatribe, do you think I'm totally full of it? Again, I don't know that I would bet it would work out this way. Actually I probably would bet on that. But I'm definitely hopeful it will.

Re: Anthropic raises $13B Series F

#610

Post by arcticbull »

Printerisreal wrote: post #581
arcticbull wrote: post #295

Earlier quoted context omitted.

They influence creation of money by adjusting the short-term interest rate which influences the demand for borrowing at commercial and retail banks. It's not that direct or straight-forward though, because they only have control over the short end of the yield curve not the long end. The long end of the yield curve has interest rates defined mostly by inflation expectations. If they dropped rates to 0% overnight it p…

they lie about real inflation, everywhere

They really don't. You can run the numbers yourself. All the prices that it's computed from are public, the methodology is public and it's dead easy to backtest. Dead. Easy. (1 + (Inflation / 100)) ^ (Years). Inflation would be the dumbest possible thing to lie about because it's so damn easy to check.

The conversation always goes like this.

You: "The government is lying about inflation!"

Me: "Ok, what rate do you think it's actually been?"

You: "10%!"

Me: "So you're telling me inflation over the last 30 years was 1700%? So prices are now 17X higher than in 1995? You sure?"

Then we look up historical prices like this.

https://www.tasteofhome.com/collection/this-is-what-grocerie...

In 1995 ground beef was $1.49/lb.

Bread was $.89/loaf.

Eggs were $0.92/doz.

Milk was $2.50/gal.

idk if you're shopping at Erewhon but where I shop ground beef isn't $25/lb, bread isn't $15/loaf, eggs, well, you got me there lol, and milk isn't $42.50/gal.

Unless the conspiracy is far bigger than we think, or "they" are everywhere, whoever "they" are, I think it's safe to assume that inflation numbers have been pretty accurate.

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