AI Giants Race to IPO: Who Will List First?

The fierce rivalry between AI pioneers OpenAI and Anthropic has significantly accelerated the generative AI boom. Initially, OpenAI rapidly developed ChatGPT after learning of Anthropic's competing chatbot project. This competitive spirit now extends to their upcoming IPOs, with both companies vying to be the first to market.

This race to list is critical for shaping investor perception and establishing leadership. OpenAI has indicated a potential IPO as early as September, but Anthropic recently announced its confidential filing, followed a week later by OpenAI. The competition involves significant financial stakes, with OpenAI aiming for a trillion-dollar valuation.

Wall Street is navigating complex dynamics as both rivals seek capital, often from the same banks. Executives at both firms are reportedly pressing advisors for insights into their competitor's plans, leading some banks to implement internal information barriers. This 'all-out war' between OpenAI CEO Sam Altman and Anthropic CEO Dario Amodei influences the pace and features of AI tool releases.

The companies also disagree on financial reporting. OpenAI contends Anthropic overstates revenue by billions due to its accounting method, which recognizes full customer payments before routing portions to partners. Anthropic maintains its method follows established practices, recognizing gross revenue as the principal in transactions. This dispute impacts how investors view their financial performance, with some analysts suggesting Anthropic's move aims to set a favorable financial reporting precedent.

The rivalry has deep roots, dating back to late 2020 when Amodei left OpenAI to found Anthropic with a focus on safety. While Anthropic initially delayed public deployment of its Claude chatbot for safety research, OpenAI, spurred by rumors of Anthropic's project, fast-tracked ChatGPT's release in November 2022. Since then, the companies have traded development leads, with Anthropic recently focusing on reasoning models and OpenAI intensifying its enterprise software efforts.

Relations soured further after OpenAI's board briefly considered a merger with Anthropic under Amodei's leadership following Altman's temporary ousting in late 2023. This proposal reportedly angered many OpenAI employees. Publicly, Altman and Amodei have exchanged criticisms regarding deceptive advertising and the leveraging of disputes, notably refusing to join hands in a show of unity at an AI summit in India in February.