Anthropic IPO: Who Can Subscribe and What Are the Risks?

Anthropic's IPO will be available in Australia and Japan, but not in South Korea. This is different from how the SpaceX IPO was handled.

Yes, it's interesting that the prospectus limits investors mainly to the Western world, Australia, and Japan. Many of the leading banks involved are from the US. Australia is represented by Macquarie, which will likely help sell the shares. It will be interesting to see how much interest wealthy investors in Asia have in this IPO. They could be a deciding factor, especially because private banks will need to take part. These investors already have many publicly traded companies they can choose from to invest in AI. So, does this IPO offer a special chance to invest in the most advanced technology being developed in the US? Do Asian technology investors and Australian funds we have spoken to over the past few days, including Australian pension funds, want to invest more after already making large profits from this type of investment? That will be very interesting to watch. Will investors who have done so well in private markets now put more money into public markets?

Bella, let's talk about the possible value of the company. Early estimates put it at $1.5 trillion to $2 trillion. What are the estimates now? Could investors reject such a high valuation?

Yes, there are still questions about whether the company will aim for the higher or lower end of that range, and how much money it will try to raise. The share price and the company's value are still unclear. Anthropic's IPO will be a major test for the whole industry. Many other IPOs have been delayed, or their funding terms have changed. How well Anthropic performs, whether the process of collecting investor orders goes smoothly, and whether its shares do well when trading begins will all matter. If the IPO goes well, it will send an important signal to the rest of the market.

Anthropic has also spoken about threats that could threaten humanity's future. We have heard about these risks for some time, but it is surprising how much attention the company is giving them.

That's right. A large part of the filing discusses serious risks that could threaten the future of humanity, which is unusual. About 100 pages look at possibilities such as the company's own AI resisting attempts to shut it down, hiding information, or creating dangers that could cause a disaster for humanity. These are among the problems Anthropic warns about. It is also important to understand the company's plan to put 5% into a public benefit fund. The fund will also study problems caused by the rapid spread and use of AI across different industries, including people losing their jobs. The company clearly understands these risks. But they also make it harder for investors to decide how much the business is worth and what price they should pay for its shares.

Joining us now is Affan Dawat, managing director of global wealth at Moneta, which manages around $50 billion. Affan, welcome. The timing of this IPO seems to show confidence.

It does. I think we are all dealing with the challenge of understanding very large numbers today. Revenue has grown by 1,300%. What does that really mean, and how can investors make sense of it? And how should they understand the more than 100 pages of risks that could threaten humanity's future? I would say the company is confident. It is so confident that it can publish figures like these, even though investors cannot properly assess them.

The valuation is 45 to 50 times the company's revenue over the past 12 months. Could investors push back against that price?

I'll explain how individual investors might see it, because I think we will see a process very similar to what happened with SpaceX earlier this year. Demand will almost certainly be much greater than the number of shares available, and this will happen around the world, as our correspondent just suggested. Then the number of shares investors receive will be reduced. Some people will also place speculative orders simply because they do not know how many shares they will actually get. So I expect very strong demand for this IPO. Why wouldn't there be? Most investors will not get as many shares as they want. After that, people will be very interested in what happens when the restrictions preventing early investors from selling their shares end. That could create another good buying opportunity for investors who do not receive shares in the IPO.