Anthropic is one of the biggest behind-the-scenes names in artificial intelligence. It would also be one of the best stocks to buy were the company public. It’s also unlikely to undertake an initial public offering (IPO) anytime soon.
For now, investors seeking exposure to Anthropic must invest in public companies that own stakes in Anthropic. Investors are especially interested in Anthropic for its methodical approach to artificial intelligence (AI) development. Claude AI has deep enterprise utility for that reason.
The company’s Claude chatbot was initially launched in the summer of 2022. The company chose to continue internal testing rather than release the chatbot. That measured approach suggests Anthropic is safety and accuracy-oriented and thus more utilitarian for enterprise applications. However, that decision paved the way for OpenAI to be first to market, launching ChatGPT months later, and becoming massively successful in the process.
That measured approach has by no means failed Anthropic. The company has instead received billions in funding from Silicon Valley’s elites. Again, its measured approach is more applicable in enterprise settings where AI ‘hallucinations’ can be highly costly.
Investors seeking exposure to Anthropic will have to settle for these stocks in companies that own stakes in the firm.
Amazon (AMZN)
Investing in Amazon (NASDAQ:AMZN) stock is one of the best ways to gain exposure to Anthropic and its future growth.
In March, Amazon completed its $4 billion investment into Anthropic. The second tranche of investment was valued at $2.75 billion and followed a $1.25 billion investment made in September of last year.
As a result of the investment, AWS is now the primary cloud provider to Anthropic. All of Anthropic’s foundational models are being trained on Amazon’s Inferentia and Tranium chips. To me, that suggests Amazon has a real chance to become a much more influential AI firm overall. What I mean is that those chips could become much more powerful and therefore more valuable. Anthropic’s Claude AI should thrive in an enterprise environment precisely because of its measured development.
Amazon Bedrock – a fully managed AWS service – is also worth understanding. AWS customers will have access to Anthropic’s foundational models as a result of the collaborative deal between the two companies. Anthropic will also funnel customers to Amazon Bedrock which will help to train the model. For now, Amazon is among the very best investments for those looking to gain exposure to Anthropic’s future growth.
Alphabet (GOOG,GOOGL)
Alphabet (NASDAQ:GOOG,GOOGL) has also invested heavily into Anthropic through its Google subsidiary, to the tune of $2 billion late last year. Stocks to buy in the leading tech firms touch on many areas of technology but these companies simply aren’t AI champions.
A good part of the reason Google, Amazon and others are investing so heavily in large language model upstarts like Anthropic is that they simply can’t match those firms or the know-how required to implement LLMs. This TechCrunch article put it best when it said those who can’t build, invest. Google counts itself amongst the LLM investors rather than the builders to date. Even if Google can build a strong LLM owning part of Anthropic is a great hedge.
Thus, it should not surprise anyone to learn that Google currently owns at least a 10% stake in Anthropic overall. The details surrounding the ownership stake are murky and could be higher than 10% in reality.
The result is that Google has a strong position in the primary rival to OpenAI’s ChatGPT and one of the leading two large language models. Again, that stake is important because in general, OpenAI is more geared toward the consumer whereas Anthropic is much more enterprise oriented. Large enterprises like Google arguably have a better opportunity to commercialize AI on the enterprise side so a stake in Anthropic is very valuable.
Salesforce (CRM)
Salesforce (NYSE:CRM) is another stock to buy for investors seeking exposure to Anthropic and its potential.
One of the more important aspects of that investment is Anthropic’s dedication to accuracy. The Claude API is rooted in accuracy. It leverages enterprise data which must be more accurate than that which is used to train models like ChatGPT which are more consumer-oriented. ChatGPT can afford to ‘hallucinate’ from time to time with relatively fewer repercussions. The repercussions of a consumer receiving incorrect information are much less costly than an enterprise-level business decision rooted in incorrect information.
Enterprise applications will not be afforded such leniency. The costs are simply too high. That’s an important part of Salesforce’s decision to invest $450 million in Anthropic.
It’s also logical to anticipate that the value of enterprise-grade large language models is simply greater than that of consumer-oriented LLMs. Stocks to buy can leverage those enterprise models to produce impressive returns. Consumer-oriented LLMs are not as utilitarian from a pure dollar perspective.
Salesforce’s $450 million investment in Anthropic means that it is well-positioned for the enterprise-grade LLM opportunity among stocks to buy.
On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.