Market Data 
I wish I could have gotten in early on that company.
With AI company valuations acting like rocketships, it’s easy to play the “what if” game.
The reality is the process isn’t as simple as writing a check and watching your money multiply many times over. (Even if it might seem that way.)
Take Anthropic. The AI giant, valued at $1.2 trillion in secondary markets, looks like a no-brainer investment now, but that wasn’t always the case. Back in 2023, it wasn’t generating revenue, didn’t have a public model, and was far behind the behemoth that is OpenAI. The asking price? A $4.1 billion valuation.
Menlo Ventures partner Matt Murphy spoke to BI’s Ben Bergman about how the VC firm had to break a lot of its own rules to greenlight the investment. A few rounds later, Menlo’s $1 billion investment is now worth around $14 billion.
But what appears inevitable now felt far from certain when the first check was written.
“There was definitely some heartburn within the firm,” Murphy told Ben.
Anthropic remains the exception, not the rule.
They don’t call them unicorns because they’re easy to find. For every $1 billion-plus startup, there are thousands that never got close.
The odds have never been great — if it were easy, everyone would do it — but they’re going to get worse.
Here’s why:
The barrier to entry is almost on the floor: AI makes it easier than ever to build a startup. Thanks to vibe coding, even people who think C++ is a new type of grade can still easily turn an idea into a company without an army of developers. If you thought it was difficult sorting through loads of startups, it’s about to get way worse.
There’s a lot of new money: Big-time acquisitions and record-breaking IPOs mean millionaires are getting minted every day. Founders love turning into investors, and there will be plenty with money to burn.
The FOMO effect: For all the people who are hitting it big, there are way more who might have just missed the boat. That’s the kind of thing that can motivate a person to jump at the next time they get an opportunity. Doubling down on the next one to make up for missing the last one can be a dangerous game, and raises the price for everyone on the hunt for deals.
So how does it all end? VC investors are built to make bets that mostly won’t pan out. Their job might get harder, but it won’t be a death knell.
But for the rest of us? The public markets are a lot more unforgiving than the private ones. So when some of these gems finally make it big, mom-and-pop investors might be the ones coming up short.
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