AI Start-Up Anthropic Nets $300 Million From Google as Chatbot Race Heats Up

The company has developed a rival product called “Claude”

oogle loses chatgpt race
Google has invested $300 million in chatbot startup Antropic.

Move over ChatGPT, here comes Anthropic’s “Claude.”

The latest tech giant to throw money at artificial intelligence is Google, which has invested about $300 million in start-up Anthropic, The Financial Times reported.

More specifically, Anthropic is one of small firms working on “generative AI,” or the type of program that can generate images, text, audio and more based on the data it is trained on.

Microsoft’s ChatGPT, has gotten the bulk of attention in the arena since its release late last year as its abilities to produce content have been discovered. The program is the result of a $1 billion investment Microsoft made in OpenAI three years ago. Last month, Microsoft and OpenAI said they were extending their partnership with a “multiyear, multibillion dollar investment” by the software giant.

The deal with Google, which will give the company a stake of around 10 percent, requires Anthropic to use the investment to buy computing resources from the its cloud computing division, The Financial Times reported, citing sources familiar with the arrangement.

So far, Google does not appear to be trying to integrate AI technology into its services. Microsoft has said it will use ChatGPT to generate customer emails, and integrate it in its Bing search engine, Office 365 and other software.

Anthropic, based in San Francisco, was founded in 2021, by a group of researchers led by Dario Amodei who left OpenAI “after a disagreement over the company’s direction,” after Microsoft’s first investment in the company, according to the FT.

The company, which identifies itself as “an AI safety and research company” has developed an intelligent chatbot called Claude to rival ChatGPT, but it has not been released publicly.

The start-up had already raised more than $700 million before Google’s investment, which was made in late 2022 but has not previously been reported, the FT said.

The company’s biggest investor, according to the report, is Alameda Research, the crypto hedge fund of FTX founder Sam Bankman-Fried, which dropped $500 million before filing for bankruptcy last year. FTX’s bankruptcy estate has flagged Anthropic as an asset that may help creditors with recoveries.

Shares of Google parent Alphabet reversed an early slump to trade just slightly down at midday. The stock lost $1.03, less than 1%, to change hands at $107.77.