General Catalyst, Spark in Talks to Back OpenAI Rival
OpenAI’s ability to line up big checks from Microsoft and other investors has quickened investor interest in unproven AI startups that want similar valuation multiples.
OpenAI is bringing back an element of the tech boom that had briefly gone dormant: steep valuations. As the artificial intelligence developer talks to Microsoft and others about a deal valuing it at more than $20 billion, at least 100 times its projected revenue this year, rival startups are trying to score similarly high prices from venture capitalists.
Among them are Adept AI Labs and Anthropic, which develop AI that people can activate using basic language prompts. Their founders include former leaders of OpenAI and Google AI. Two-year-old Adept recently sought a valuation as high as $1 billion, up from a roughly $250 million valuation in a financing last year, according to people familiar with the situation. It is currently in talks with venture capital firms General Catalyst and Spark Capital for the new funding, these people said. (Update, Jan. 13: The Information has reported that two of Adept's co-founders just left the company to launch their own startup.) Anthropic, meanwhile, has signaled to some prospective investors that it wants a valuation of at least $5 billion, one of these people said. Its major backers include Sam Bankman-Fried, the now-indicted crypto entrepreneur.