OpenAI and Anthropic Share Over 90 Common Investors Despite Being Rivals

OpenAI and Anthropic, fierce AI competitors, share over 90 common investors, reflecting venture capital's shift towards diversification in an uncertain, high-stakes market. Despite historical norms of concentrating bets, the scale and potential of AI have led investors to back both, hoping to maximize returns regardless of which lab dominates. Experts describe this overlap as unusual or unprecedented, citing the industry's evolution and the massive sums raised by both companies. The phenomenon also highlights the challenge of predicting which, if any, AI lab will emerge victorious in a potentially broad market. With both aiming for IPOs, investors may be doubling their odds, though this strategy also introduces complexities, including potential conflicts of interest. Historically, venture firms avoided backing competitors to maintain clear relationships and avoid proprietary information conflicts. However, with today's larger, longer-lived private companies, the concern over conflicts has diminished, as investors hold smaller, less influential stakes. Some investors justify the dual bets by comparing AI's transformative potential to investing in both Pepsi and Coke, emphasizing widespread demand. Others highlight OpenAI's unique corporate structure, which historically limited investor returns, as a motivator for also investing in Anthropic. The overlap is not without precedent; SoftBank previously invested in competing ride-hailing firms globally, though it avoided direct US competitors. As the AI market evolves, the investment strategy reflects a belief in AI's broad impact across industries, with USVC's Ankur Nagpal stating the goal is to own slices of future valuable companies. Despite this, firms like Menlo Ventures and Thrive Capital have chosen to back only one, citing a belief in going "all in" on portfolio companies. The situation may also reflect a fear of missing out (FOMO) on the next big thing, as noted by economist Steve Kaplan. Inadvertent investments, like Madrona Ventures' unintentional overlap due to startup acquisitions, could become more common as AI startups pivot rapidly. Ultimately, the dual investments signal a market view that AI's growth will be multifaceted, with room for several major players. As one venture capitalist put it, "Why wouldn’t you want to be in both Pepsi and Coke? It’s the same here."