Venture activity in the generative AI market began to slow in the third quarter, with the number of funding rounds dropping by 29% from the previous quarter. However, the combined dollar value of these rounds increased, largely due to Amazon's investment in Anthropic. Looking ahead, OpenAI is reportedly in talks to raise new capital at a valuation exceeding $100 billion, while Anthropic is said to be seeking a $750 million investment at a $15 billion valuation.
Key takeaways:
- Amazon, Microsoft, and Google invested more in generative AI startups in 2023 than venture capital firms, with the tech giants accounting for about two-thirds of the $27 billion raised by these startups, according to PitchBook.
- The largest generative AI deal of 2023 was Microsoft’s $10 billion investment in OpenAI, with Microsoft set to take a 49% stake in the AI developer once it recoups its investment.
- Anthropic PBC, a generative AI company, secured an investment worth up to $4 billion from Amazon and another funding round worth up to $2 billion from Google, making it the second highest capital raiser after OpenAI.
- Nvidia Corp. backed 35 funding rounds in 2023, making it the year’s “most active large-scale investor in AI” excluding accelerator funds, according to DealBook.