Why Anthropic is keeping its top model hidden even ahead of its IPO

In the Loop host Ejaaz Ahamadeen breaks down Anthropic's (ANTH.PVT) two new models, one of which is publicly available while its most powerful model stays hidden, and its strategy to capture markets ahead of both its IPO and OpenAI's (OPAI.PVT) IPO.

It's official, Anthropic has once again unseated Open AI to become the number one model lab in the world with the release of not one, but two brand new models, Fable and Mythos 5.2. Now, Fable 5.2 is a model that's generally available to you and I. And for all intents and purposes, it's a fantastic model. It's amazing and number one at coding, general reasoning and visual creation.

But the craziest part about this is it's not even Anthropic's most powerful model. Their most powerful model is actually being hidden behind the doors and has been given a code name, Model 4. And you might be asking, well, why hasn't Anthropic released this? Well, that points towards a certain type of strategy that both Anthropic and Open AI, the two top AI labs in the world are employing ahead of some of the biggest IPOs in the world.

Now, for Anthropic, that IPO is looking to be in the next 6 to 12 days with new information that was released yesterday that they are targeting around a 1 to $1.3 trillion valuation, which is down from $2 trillion, which is much healthier in my opinion. But that's off the back of still insane demand to the tune where they hit $80 billion of ARR in the last month.

These exponentials are getting even steeper. But then you might be asking, okay, why release a model that's only slightly better than your previous models. If I had to answer that, it's because of two reasons. They are getting into a bit of a competition with Open AI, making sure that they always leap frog ahead of each other. So that's why they would keep a more powerful model behind the scenes.

But number two, maybe a larger point is we're seeing an increasing gap between the large labs of public models and hidden models. And that gap is getting larger and larger and larger. And that might be the two reasons. One, the models that are internal are or be it more powerful, but also more misaligned, which means that if they were generally available to everyone that could be used for misaligned purposes.

They need to figure out a way to align the models before they can confidently put them out. But number two, and this is arguably the more sinister reason, if you're Open AI or if you're anthropic and you have a model that's capable of solving some of the biggest problems in the world, wouldn't you just keep that to yourself to solve those problems and then capture those markets yourself?

I'm talking like things like science, robotics, solving medicine, curing cancer. These are all potential markets that are going to become increasingly available to two, maybe three specific companies as they absorb all the markets around them as AI consumes all these different markets around it. So you can imagine they would want to start gatekeeping some of these models.

And listen, with Fable 5.2, you're starting to see the emergence of this capability. It's not just about AI models being really good chatbots and LLM's like the majority of people use AI models today. It's about these models doing things outside of that, solving really complex problems in mathematics, physics and chemistry, which forms the bedrock of solving things like cancer and some of the biggest ailments in the world.