Anthropic aims to show investors a market valued at over $30 trillion. The annual GDP of the United States is 32.5 trillion.
Key takeaways:
- According to the Wall Street Journal, the company behind Claude estimates its potential market at over $30 trillion, or roughly the annual GDP of the United States.
- This is not a sales forecast, just a figure from an investor presentation intended to justify a valuation of around $2 trillion at the planned debut.
- SpaceX recently reported 28.5 trillion, Uber in 2019 6 trillion. Analysts called these numbers marketing, not math.
The slide that investors are expected to see before Anthropic’s debut is said to be worth $30 trillion. Putting another one next to it is enough to make things unpleasant. The annual GDP of the United States is 32.5 trillion. The entire American year of work combined.
Where does thirty trillion come from?
TAM, or total available market, is the company’s theoretical revenue with a hundred percent share. How many companies capture one hundred percent of their market? None. The number is for scale, not for budgeting.
Anthropic, according to the Wall Street Journal, does not count it in a category such as enterprise software or cloud. It counts by the work that models can do instead of humans: legal documents, accounting and engineering.
Alex Brunicki from the Backed VC fund explains it directly. Since the model writes the code from start to finish, the market for such a product is simply the labor market for this code.
So this number doesn’t measure sales. It measures how much human labor costs today, which could be taken over by a machine.
Does anyone really believe this?
Both yes and no. Brunicki says professional investors will treat this estimate as a mission statement and then build their own cash flow models based on the contracts. However, it adds something that should turn on a light for you. Retail investors will take this number as a bargainbecause they do not have the time or data to submit their own spreadsheet.
Fred Hickey, technology analyst and publisher of The High-Tech Strategist newsletter, put it more sharply. He wrote on X that this nonsense is tolerated on one side of the table. The idea is for Wall Street and Silicon Valley to extract as much as possible from unsuspecting investors before the bubble bursts.
TAM stands in this presentation precisely to bridge the gap between today’s revenue and the valuation the company is asking for.
Uber once counted six trillion
The big number in the presentation says nothing about what will happen to the stock after its debut.
What does this mean for you
Anthropic has real revenue and it is growing. According to Bloomberg, it was growing at a rate of more than $65 billion annually at the end of July, up from about $9 billion at the end of last year. No presentation can invalidate this achievement. Something else undermines it: the company shows a number of the size of the American economy and asks for trust for a decade.
Not buying Anthropic stock? This number applies to your portfolio anyway, because the valuations of technology companies drag down the entire market of risky assets, and with it crypto. There is no signature or deadline for the thirty trillion, and this is what distinguishes an invitation from a quote.
In October 1999, one hundred and ninety-nine Internet companies tracked by Morgan Stanley had a combined $450 billion in capitalization, $21 billion in sales and $6.2 billion in losses. The presentations from 1999 were also convincing and talked about a borderless market. How many of them have survived to this day? Hint: most didn’t make it.
