Sequoia Capital Breaks VC Norms With Reported Investment in Anthropic

Sequoia Capital is set to join a massive new funding round for Anthropic, the artificial intelligence company behind Claude, according to a report by the Financial Times. The move is drawing sharp attention across Silicon Valley, as it challenges one of venture capital’s longest-standing unwritten rules: avoid backing direct competitors.

Sequoia is already an investor in OpenAI and xAI, making its reported support of Anthropic a rare example of a top-tier VC simultaneously backing multiple rivals in the same AI race.

Why This Investment Stands Out

Traditionally, venture firms choose a single winner within a competitive sector to avoid conflicts of interest and protect access to sensitive information.

That norm was publicly reinforced last year when Sam Altman, CEO of OpenAI, testified under oath that investors with access to OpenAI’s confidential data could lose that access if they made “non-passive investments” in competing companies.

Against that backdrop, Sequoia’s reported participation in Anthropic’s round is especially striking.

A $25 Billion Round at a $350 Billion Valuation

According to the Financial Times, the new funding round is being led by Singapore’s GIC and U.S.-based investor Coatue, each contributing $1.5 billion. Anthropic is reportedly targeting a raise of $25 billion or more at a valuation of $350 billion, more than double its estimated $170 billion valuation from just four months ago.

Other reports indicate that Microsoft and Nvidia have committed up to $15 billion combined, with venture capital firms and additional investors contributing another $10 billion or more.

Earlier coverage by the Wall Street Journal and Bloomberg had pegged the round closer to $10 billion, which underscores how rapidly the deal has expanded.

Deep Ties Between Sequoia and Sam Altman

Sequoia’s relationship with Altman stretches back decades. The firm backed Altman’s first startup, Loopt, after he dropped out of Stanford.

Altman later served as a Sequoia scout, introducing the firm to Stripe, one of its most successful investments. Sequoia co-leader Alfred Lin has also maintained a close public relationship with Altman, including voicing support during Altman’s brief ouster from OpenAI in 2023.

Not the First Time Sequoia Has Defied Convention, But a Major Shift

While Sequoia’s investment in xAI was often viewed as part of its broader relationship with Elon Musk backing Anthropic represents a more direct reversal of the firm’s historic stance on conflicts.

In 2020, Sequoia famously walked away from payments startup Finix after concluding it competed with Stripe, forfeiting a $21 million investment and relinquishing its board seat and shares. That decision was unprecedented in the firm’s history and underscored how seriously it once treated portfolio conflicts.

Leadership Changes and an IPO on the Horizon

The reported Anthropic investment comes amid major leadership changes at Sequoia. Longtime global steward Roelof Botha was recently pushed aside, with Alfred Lin and Pat Grady stepping into leadership roles. Notably, Grady had led the Finix deal that Sequoia later abandoned due to competitive concerns.

Anthropic, meanwhile, is reportedly preparing for an IPO that could arrive as soon as this year, positioning the company as one of the most valuable AI firms ever to approach public markets.

Sequoia Capital has not yet commented publicly on the reported investment.