Anthropic is anticipated to present investors with a $30 trillion market opportunity.

      Anthropic is expected to inform IPO investors that its potential revenue opportunity exceeds $30 trillion. This estimate surpasses the $28.5 trillion that SpaceX presented to investors prior to its record-breaking listing. Corrie Driebusch reported this figure for The Wall Street Journal, citing individuals familiar with the situation.

      Companies that go public often provide an estimate of their total addressable market to demonstrate to investors how much growth potential remains. This figure represents the annual revenue a company could theoretically capture if it achieved 100% market share. Bankers derive this number from industry data and their own models.

      To put the $30 trillion figure into perspective, the 191 technology companies within the S&P 1500 generated $2.4 trillion in revenue last year, according to FactSet data referenced by the Journal. Anthropic’s estimate exceeds that by more than twelve times, suggesting a market where a single company could eventually earn a dozen times more than what the entire listed American technology sector currently collectively earns.

      It is important to note that the company is not claiming it will actually collect this revenue. A total addressable market (TAM) indicates the size of the opportunity, not the actual revenue a single company can achieve. However, the size of this opportunity supports the valuation argument.

      Anthropic arrives at its figure by examining the complete range of tasks that AI models could potentially perform, according to sources speaking to the Journal. This perspective takes into account human labor rather than merely software expenses, which is how the estimation reaches such a large number.

      The $30 trillion figure represents a significant increase over a short period. When Uber went public in 2019, it claimed a $6 trillion market opportunity by valuing every personal vehicle and public transport service globally. At that time, Wall Street considered this aggressive. WeWork, which eventually abandoned its offering, cited a $3 trillion opportunity, demonstrating how much market estimates can vary and their limited utility in proving a company's market viability.

      SpaceX raised the bar in May, announcing a $28.5 trillion "largest actionable" market in "human history" in its filing, with most of that figure, $26.5 trillion, attributed to AI rather than its space activities. Essentially, SpaceX predominantly marketed itself as an AI venture, a narrative that Anthropic appears ready to pursue without any obligations related to aerospace.

      Aswath Damodaran, a finance professor at New York University, often referred to as the Dean of Valuation on Wall Street, previously evaluated SpaceX’s number before its June offering. He remarked that the AI component was “pushing the boundaries of what’s plausible,” indicating that Anthropic’s estimate would exceed SpaceX's by $1.5 trillion.

      This aspect is crucial to understanding the market's dynamics. After SpaceX's shares initially surged upon offering, they later declined, dropping below $105 in early August and currently trading around the $135 offering price. An investor who anticipated the largest addressable market in human history gained nothing from it within three months. This serves as the latest evidence regarding the practical value of a TAM.

      Anthropic is proposing even higher figures in a market that has already witnessed significant stagnation in the previous offering.

      In terms of actual earnings, Anthropic more than doubled its revenue in the second quarter to $11.6 billion, reflecting substantial real growth based on a solid foundation; this represents a more than fourteenfold increase within a year. Reports from Reuters suggest that the company anticipates approximately $190 billion to $200 billion in revenue by 2028, with its IPO valuation grounded in these forecasts.

      Achieving the upper end of that forecast would place Anthropic at less than 1% of the market it describes. The disparity between what a TAM projects and what a company actually earns forms the crux of this discussion.

      A large addressable market serves a function beyond impressing investors. It legitimizes a company's valuation and the infrastructure investments required to support it. Moreover, it guides product priorities, frames the competitive landscape against OpenAI and Google, and reinforces the growth narrative surrounding the listing, as noted by Juby Babu for Reuters. In this context, the $30 trillion figure reflects more a declaration of the industry Anthropic believes it operates within, opting to count the potential tasks rather than solely focusing on software.

      However, these details remain unofficial. Anthropic has not disclosed this figure publicly and is still in discussions regarding its IPO plans, which may result in some adjustments to the numbers, according to sources cited by the Journal. The company did not respond immediately to Reuters’ request for comments and has yet to publicly announce a $30 trillion market.

      Anthropic is aiming to raise as much as $100 billion, more than the $86 billion garnered by SpaceX. The company seeks a valuation close to $2 trillion, exceeding the $1.77 trillion that SpaceX achieved. Relative to the multiples currently assigned to AI companies, this