AI startup Anthropic, which is heavily backed by Amazon (AMZN), is close to securing $3.5 billion in funding, raising its valuation to $61.5 billion, according to the Wall Street Journal. This major funding comes as competition in the AI market grows, with top firms like OpenAI and Elon Musk’s xAI racing to stay ahead.
Founded by former OpenAI employees, Anthropic is known for its chatbot “Claude,” which has become widely popular. The latest version, Claude 3.7 Sonnet, provides faster responses and better reasoning, making it useful for programmers and businesses.
Big Investors Bet on Anthropic’s AI future
Anthropic is one of the main rivals to OpenAI, the maker of ChatGPT, in developing large-scale generative AI models. The startup originally planned to raise $2 billion but increased its target due to strong investor demand.
Top venture capital firms like Lightspeed Venture Partners and General Catalyst are supporting Anthropic. In addition, Abu Dhabi-based investment firm MGX is in talks to join the funding round, reflecting global interest in the company’s AI work.
Last month, Alphabet’s (GOOGL) Google also announced a $1 billion investment in Anthropic. This follows Google’s earlier commitment of $2 billion to the startup.
AI Race Heats Up as Rivals Chase Big Money
Anthropic isn’t the only one seeking billions. OpenAI, which has received major investments from Microsoft (MSFT) and Elon Musk’s xAI, are also raising large sums as the AI arms race intensifies.
At the same time, China’s DeepSeek is gaining attention with advanced and affordable AI models, adding more pressure to the competition.
What Is the Price Target for AMZN?
Turning to Wall Street, analysts have a Strong Buy consensus rating on AMZN stock based on 47 Buys and 1 Hold rating assigned in the past three months, as indicated by the graphic below. The average AMZN price target of $269.00 per share implies 26.46% upside potential.
