Google CEO Pichai says ‘AI shift’ opens opportunities invest startups
With Alphabet Google CEO Sundar Pichai, who stands to potentially make $100 billion or more from his bet on Elon Musk’s SpaceX in 2015, said the boom in artificial intelligence has opened the door to more startup investment.
“You know SpaceX, Anthropic and so on, now with the AI shift, I think there are more opportunities where we can allocate capital well, and that’s what we’re doing,” Pichai said. speech A post was made on Tuesday with Stripe co-founder John Collison.
Google has long been in the startup investment game through its early-stage venture group GV and growth arm CapitalG. But with today’s AI companies needing checks worth hundreds of millions or billions of dollars, Google’s parent company Alphabet is joining other tech giants. Nvidia, Microsoft And Amazon getting around the enterprise path and getting off the balance sheet.
Alphabet first invested in SpaceX in 2015, raising $900 million at a valuation of around $12 billion. In February, SpaceX merged with Musk’s xAI in a deal valued at $1.25 trillion. Assuming Alphabet holds all its shares, its shares would now be worth around $100 billion and could rise in the coming months.
Last week, SpaceX confidentially filed for an initial public offering, and the company is reportedly seeking a $1.75 trillion valuation in what could be a record offering.
There’s also OpenAI rival Anthropic, which competes with Google on the AI model layer but has also partnered with the search company by committing to buy billions of dollars worth of tensor processing units, or TPUs, and cloud infrastructure.
Google invested $300 million in the artificial intelligence laboratory in 2023 in exchange for a stake of approximately 10%. Months later, another $2 billion poured in. Since then, Anthropic’s valuation has risen from single-digit billions to $380 billion as of the last round in February as Google put in additional capital.
In total, Google’s investment in Anthropic now exceeds $3 billion. reportedly owns 14% of the company’s shares.
Pichai’s latest comments indicate that Google may turn to additional external investments as the returns of artificial intelligence increase. He added that the company wants “to be a good steward of capital.”
“To the extent that you’re bullish on ROIC, you want to put every dollar possible into it,” he said, referring to return on invested capital.
While talking to Collison about investing, Pichai was sharing his views with the leader of a portfolio company.
Stripe’s value increased more than 17 times to $159 billion as of February Since GV participated in a $150 million round in 2016. CapitalG is also an investor in the fintech company.
“We felt that our investment in Stripe was a good steward of our capital,” Pichai told Collison.
Pichai also talked about Waymo, Alphabet’s autonomous vehicle division. Waymo raised its first external investment round of 2020 to $2.25 billion. Earlier this year, Waymo raised $16 billion in funding, valuing the company at $126 billion; Alphabet contributed to the financing, as well as a number of outside investors.
When Waymo was first raising money, Alphabet wasn’t putting as much money at its disposal as it is today.
“I would have been happy to invest more capital in Waymo earlier, but we weren’t at the maturity level to do that,” Pichai said.
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