Investor Loyalty in the Age of AI Giants
With OpenAI securing a new $100 billion round and Anthropic closing a $30 billion raise, it’s evident that investor loyalty is becoming a rare commodity in the tech world.
Notable investors in OpenAI, such as Founders Fund, Iconiq, Insight Partners, and Sequoia Capital, were also backers in Anthropic’s recent raise. While it’s common for hedge funds and asset managers to invest in competing companies, some instances, like BlackRock’s involvement in both OpenAI and Anthropic, raise eyebrows.
Despite personal associations and potential conflicts of interest, investors are seizing opportunities in the rapidly growing AI sector. The history of relationships between companies like OpenAI, Microsoft, and Nvidia further complicates the loyalty dynamic.
Traditionally, venture capital firms have operated with a focus on supporting startups and fostering their success. However, the allure of massive returns in the AI industry is challenging this norm.
Startups share confidential information with their investors, who often take board seats, adding another layer of responsibility. Sam Altman, with his VC background, navigates this landscape carefully, as seen in his actions regarding OpenAI’s perceived rivals.
The influx of funds into AI labs is unprecedented, leading to staggering growth and investment needs. As the stakes rise and returns potential grows, investors face tough decisions about where to allocate their resources.
While some investors, like Andreessen Horowitz and Menlo Ventures, have chosen to back either OpenAI or Anthropic, not both, others, including Bessemer Venture Partners and General Catalyst, have invested in both.
Despite the shifting landscape, conflict-of-interest policies are becoming crucial considerations for founders when evaluating investment opportunities. The disregard for traditional loyalty norms by prominent firms like Sequoia signals a paradigm shift in the industry.
