AI Summary
The video discusses Anthropic's unexpected delay of its IPO and the concerning financial disclosures in Nscale's S-1 filing. The creator analyzes the reasons behind the delay, including market conditions and internal financial struggles, and highlights red flags in Nscale's audit and related-party transactions.
Chapters
Anthropic announced it is delaying its IPO until November, contrary to earlier plans for September. The announcement coincided with the release of Nscale's S-1 filing.
The creator suggests that insiders may be seeing negative financials or market conditions that are not public, prompting the delay. He questions whether Anthropic's financials are strong enough for a public offering.
Anthropic's Claude models (Opus, Sonnet) have been performing well on leaderboards like OpenRouter, but the creator notes they are not always at the top, with competitors like DeepSeek and GLM also appearing.
Possible reasons for the delay include safety concerns, the need for a bull run to maximize valuation, or waiting for more compute. The creator doubts safety is the real reason.
Anthropic expects to reach $100 billion in annualized recurring revenue by the end of July, but may wait until early next year to IPO to achieve a higher valuation.
The creator tracks market sentiment via YouTube comments, noting that bearishness peaked in May and has been accelerating downward in September, which may have influenced the delay.
Anthropic expects to have 5 gigawatts of compute by the end of the year, up from 1-2 GW last year. At $20 billion per gigawatt, this implies a massive valuation, but the creator questions sustainability.
Anthropic held meetings with venture capital firms, technology banks, and investors, but walked away without a deal, suggesting concerns about the IPO's viability.
Nscale's S-1 filing discloses material weaknesses in internal controls over financial reporting, which is a significant red flag for investors.
Nscale entered into a nearly $45 billion deal with Anthropic, which the creator finds suspicious and embarrassing, raising questions about the nature of the transaction.
The video concludes that Anthropic's IPO delay and Nscale's financial disclosures raise serious concerns about the health of the AI sector. Investors should be cautious and scrutinize financial filings carefully.
Mentioned in this Video
💡 Key Takeaways
Insider Concerns
Highlights the potential gap between public perception and insider knowledge, a key factor in IPO timing.
01:38Revenue Projections
Provides concrete numbers on Anthropic's growth, essential for understanding its valuation.
06:16Nscale Audit Issues
Reveals a critical red flag in Nscale's financial reporting, crucial for investor due diligence.
11:33Related-Party Deal
Raises questions about the legitimacy and transparency of Nscale's major transaction with Anthropic.
12:33Full Transcript
[00:05] the dip The dip Here we go Come on Push it by the dip. All righty Well this was unexpected it
[00:21] First it was saying you know how about October We'll just file it in
[00:33] plans to IPO until November And this announcement that Anthropic now delaying their IPO is coming on the the same day we got
[00:45] the N scale S1 one drop Now remember the trying some things in there that are kind of like
[01:02] stream Apparently now I'm I'm choking on myself So trying to went through the entire S1 document I'm going to go through
[01:14] in there I'm like man where's all this money going to come myself are the Anthropic Financials that bad that they
[01:26] preipo documents "Hey y'all might want to before you put this into the the market
[01:38] on Like what are the insiders seeing that we're we're not best sample of that is probably stuff like the shenanigans that
[01:50] to put it this way We're going to go go through that and
[02:02] waiting for them to to IPO I'll show you why in just a moment here Uh keep in mind we do also have worshes balls that that
[02:14] The coupon code over at mekev.com and the uh uh alpha you get that six months of terminal access as well when
[02:26] at this The AI giant has been expected to stage a from September Now some of Anthropic's advisors advisors
[02:38] startup time to share thirdarter financials that show a strong position Interesting that they want to wait until Q3 to quote
[02:50] leading in kind of kicked their
[03:02] when they were in in the lead They had the lead How' they have Claude Cowwork and and Claude Code which were an absolute boom
[03:15] of the world Let's I freaking documents
[03:27] to put these documents together So I bet you if Anthropic could they would have right after the April April ceasefire that we
[03:39] long to get these documents together especially when you're to add so many more disclosures and risk factors and going
[03:51] Nscale document in a moment But look at this Some of Enthra's time to share their Q3 financials Okay Again and this
[04:03] rankings really quick So if I go to open router and I go to like clawed opus opus on the right side Like they're actually on
[04:15] June I've got Claude in there If I go back to to group right Uh I've got
[04:27] Claude Opus over here regularly on the leaderboard on Open recently I've got Deepseek I got GLM I got got GPT56 which is the
[04:40] open weight Claude on that top side of the leaderboard
[04:52] to hugging face I actually see that that Hugging Face argues LLM leaderboard this is sort of their benchmarking they still
[05:04] GPT but at least when router I'm not really seeing them up there more I'm not seeing it right now So maybe they're trying to
[05:16] some more growth or they're waiting for some more compute to important in just a moment Some people familiar with the timing
[05:28] before the public warning from an anthropic researcher set set This is a whole safety concern I doubt that I think they're
[05:40] they're losing so much money that they need need a bull run they're just going to make the the weak
[05:52] purposely trying to time uh a top almost or or something where has already argued that they're going to wait to go public until
[06:04] think OpenAI is just waiting for Anthropic to IPO so they could a surprise That's kind of old old news What's interesting
[06:16] this delay the New York Times does a piece and says that billion in annualized recurring revenue this year That would be
[06:28] billion at the end of July And so they're thinking hey on this 31st numbers we think we're going to have hundred billion
[06:40] waiting until the beginning of next year but they might be IPO to come out Uh so hopefully they can IPO
[06:52] have been nervous You got peak fear around Iran Obviously going on with Iran in terms of uh people and and their
[07:04] more bearish I actually have a tracker tracker where what we'll YouTube com the people who leave comments on the YouTube section
[07:16] that sentiment peaked somewhere around May and since accelerating its downturn here in September So you are getting
[07:28] said Anthropic doesn't want that that bearishness They need basically Okay Anthropic also argues that they expect to
[07:40] That's well up from the 1 to 2 gawatts they had at the end of uh last year And And if they're at 5 gawatts billion dollars of
[07:56] depend on the timing of when some of those could this this is also a problem but it's something to
[08:08] annualized recurring revenue and you have 5 gawatt of compute That's great Now you have have $20 billion per gigawatt of
[08:20] compute Well Elon Musk is trying to charge $40 billion massively upside down If number They're trying to IPO off
[08:37] sustainable but I'd like them to go go public so I could keep an coal mine But now they keep kicking the can down the road
[08:49] reality they shut down and go I don't know man Y'all probably making that up either It's literally right here on Thursday
[09:01] from venture capital firms technology and probably the IPO or whatever They've been been
[09:13] banks and get commentary from investors from lenders had Andre Karpathy to go shillanthropic And apparently
[09:25] yesterday in San Francisco Apparently they still walked away away from that going you know y'all might consider under your your belt I don't
[09:41] know That doesn't sound bullish Then I'm like all already going through the can get in the MEaven
[09:57] their IPO And I'm like "Oh well that's convenient I literally analysis." Here's what freaks me out There are a couple things
[10:09] about Nscale First they bluntly disclose that they have good for these
[10:21] bro company that I know his last name is Pay I'm not sure if it's Josh or
[10:33] bro and they opened they switched to GPU compute in 2023 brilliant move like hats off Good move You guys took
[10:45] you know what The boy to become a cryptomining GPUs and
[10:57] and scale Now the company's got a thousand thousand employees So move But that doesn't mean y'all should have weak accounting
[11:09] Like they are PCAOB audited But I want to be clear about that So these folks Okay we're
[11:21] CAOB not say this You look at our last one a we don't have a
[11:33] this In connection with our audit of their financial identified deficiencies we concluded represented material
[11:45] reporting What combination of deficiencies
[11:57] there is a responsible possibility that material prevented or detected on a timely basis That's sussy You
[12:09] you should have pretty freaking clean financials in my opinion damn problem and this this one's even bigger than that Okay
[12:21] very very important You can't ship But here's another problem What is this This is ridiculous
[12:33] was very embarrassing embarrassing when I read this So entered into a deal for almost $45 billion with Anthropic And
[12:45] than a week ago It was 3 weeks ago the the Enthropic
