In its effort to become a major player in generative artificial intelligence, Amazon.com has said it is investing as much as $4 billion in Anthropic, an AI safety and research startup.
Founded by OpenAI veterans, the group behind ChatGPT, Anthropic’s pitch is to make a safer kind of AI for such tasks as summarizing, searching, answering questions, and coding.
Anthropic’s AI assistant, which rivals ChatGPT, is called Claude. Claude offers a wide range of generative AI capabilities ranging from “sophisticated dialogue and creative content generation to complex reasoning and detailed instruction.”
Part of the massive funding from Amazon aims to help Anthropic pay the huge costs required to train and run massive AI models, including compute power and research programs.
Prior to this deal with Amazon, Anthropic had raised more than $1 billion as of July 2023 from backers that included Alphabet, Google’s parent company, which invested almost $400 million in the AI and public-benefit startup.
Other key players in the fast growing so-called generative AI space, which many enthusiasts believe could be the next great frontier, include Google’s Bard and Microsoft-backed OpenAI.
While it’s still early days for generative AI, Amazon executives have revealed that more than 100,000 customers have used their machine-learning AI tools to date.
Reinforcing Why You Should Invest In AI
Amazon’s $4bn investment into a ChatGPT rival reinforces why almost all businesses and investors should have some AI exposure in their investment mix, says the CEO of dVere Group, an independent financial advisory, asset management, and fintech organization.
The comments from Nigel Green of deVere Group comes hot on the heels of the e-commerce giant Amazon saying on Monday it will invest $4 billion in Anthropic and take a minority ownership position. Anthropic was founded by former OpenAI (the company behind ChatGPT) executives, and recently debuted its new AI chatbot named Claude 2.
Nigel Green commented:
“This move highlights how the big tech titan is stepping up its rivalry with other giants Microsoft, Google and Nvidia in the AI space. The AI Race is on, with the big tech firms racing to lead in the development, deployment, and utilization of artificial intelligence technologies.
AI is going to reshape whole industries and fuel innovation - and this makes it crucial for investors to pay attention and why almost all investors need exposure to AI investments in their portfolios.”
While it seems that the AI hype is everywhere now, we are still very early in the AI era. Businesses and investors should act now to have the ‘early advantage.’
“Getting in early allows investors to establish a competitive advantage over latecomers” says Nigel Green.“They can secure favorable entry points and lower purchase prices, maximizing their potential profits.”
This tech has the potential to disrupt existing industries or create entirely new ones. “Early investors are likely to benefit from the exponential growth that often accompanies the adoption of such technologies,” says the deVere CEO. “As these innovations gain traction, their valuations could skyrocket, resulting in significant returns on investment.”
While AI is The Big Story currently, investors should, as always, remain diversified across asset classes, sectors and regions to maximize returns per unit of risk (volatility) incurred.
Diversification remains investors’ best tool for long-term financial success. As a strategy it has been proven to reduce risk, smooth-out volatility, exploit differing market conditions, maximise long-term returns and protect against unforeseen external events.
Of the latest Amazon investment, Nigel Green concludes: “AI is not just another technology trend; it is a game-changer. Investors need to pay attention and include it as part of their mix.”