VCs will make billions on Anthropic's IPO, but Amazon is set to make much (much) more | TechCrunch

Anthropic's impending initial public offering (IPO) is set to yield substantial profits for numerous investors, particularly venture capital firms like Menlo Ventures, Sequoia, Sound Ventures, and Spark Capital, which are anticipated to realize billions from their stakes. However, according to Anthropic's S-1 filing, none of these venture capital firms possesses a 5% ownership stake, which is the minimum required to be listed among the primary stockholders. This is quite atypical, as it is common for leading venture investors in technology IPOs to maintain double-digit ownership percentages in the startups they support. The rarity of this situation is attributed to the sheer size of Anthropic, which boasts a private valuation of $965 billion. For instance, Menlo Ventures holds a stake worth approximately $14 billion, equating to around 1.5% of the company, as reported by Bloomberg.

While venture firms may not have large percentage stakes, Anthropic has sold significant shares to strategic partners, which also serve as business collaborators. Among these, Amazon is poised to be the most significant financial beneficiary from the IPO. Amazon initially invested in Anthropic in 2023, committing up to $4 billion to the AI firm. Since then, Amazon has invested additional billions into Anthropic. Rather than acquiring shares outright, Amazon structured a substantial portion of its investment as convertible notes, a type of debt that transitions into equity upon an IPO or acquisition.

As of June 30, Anthropic's S-1 indicates that Amazon holds convertible notes with an outstanding principal of $6.2 billion, representing Anthropic's total debt. However, as Anthropic's valuation has risen through various funding rounds, the shares that these notes will convert into have significantly increased in value. Amazon's own financial reports estimated that its note holdings were valued at $97.9 billion as of the same date.

With the escalating value of Amazon's convertible notes, Anthropic has had to reflect this rising liability on its financial statements. For the first half of 2026, the company reported a non-cash charge of $72.4 billion under “change in fair value of convertible notes, derivative liabilities, and SAFEs.” Amazon's notes could potentially convert into up to 1.84 billion shares, but there is a restriction that limits Amazon to owning 12% of Anthropic's “partially diluted” share count, which includes some shares that have not yet been issued, like stock options. Amazon has the option to waive this cap, and any notes that do not convert will remain outstanding and can convert in future quarters, subject to the same limit.

In addition to the convertible notes, Amazon has also invested in Anthropic through nonvoting preferred stock, contributing $10 billion in the second quarter alone. This investment included $5 billion in each of Anthropic's last two funding rounds. Altogether, Amazon's total investment in Anthropic, combining the $8 billion from its note investments between 2023 and 2025, amounts to approximately $18 billion.

Beyond potential stock gains, Amazon is also set to generate significant revenue from its partnership with Anthropic, which has pledged to allocate at least $110 billion to Amazon Web Services (AWS) over the next decade. Similarly, Google stands to benefit substantially from Anthropic's IPO and its cloud computing agreements with the company. As of early last year, Google owned about 14% of Anthropic, according to court documents cited by The New York Times, and has since invested additional funds, including $10 billion in April. However, it is likely that Google’s stake has been diluted in subsequent funding rounds, with PitchBook analyst Harrison Rolfes estimating its current ownership to be around 5.6%. Google has also secured commitments of at least $114 billion in cloud services from Anthropic through 2033.

While venture capitalists are poised for significant financial returns, the S-1 filing underscores that the real winners from Anthropic's IPO may be tech behemoths like Amazon, which supported a potential competitor early in its journey and continues to provide it with essential computing resources. The S-1 also cautions that some of these cloud providers are developing competing AI models, which may not always align with Anthropic's interests.