In a significant shift for Silicon Valley's venture capital ethos, at least a dozen direct investors in OpenAI were also announced as backers in rival Anthropic's recent $30 billion funding round. The dual investments by prominent firms including Founders Fund, Iconiq, Insight Partners, and Sequoia Capital signal a fraying of the traditional concept of investor loyalty in the high-stakes artificial intelligence sector.
The development comes as OpenAI is on the verge of finalising a new $100 billion funding round, highlighting the unprecedented capital demands and growth trajectories of leading AI labs. This new dynamic raises questions about conflicts of interest, as venture capitalists have historically marketed themselves as "founder-friendly" partners committed to a startup's success against its rivals.
Blurring Lines and Boardroom Conflicts
The situation presents clear potential conflicts. Startups are private companies that typically share confidential business information with their direct investors, data not publicly disclosed. In many cases, VCs also take board seats, incurring a fiduciary responsibility to their portfolio companies. "If you are an owner of both OpenAI and Anthropic, who is your loyalty to, besides your own investors?" the scenario asks.
One particularly notable case involves BlackRock. Affiliated funds of the asset management giant joined Anthropic's raise, despite BlackRock’s senior managing director and board member, Adebayo Ogunlesi, also sitting on OpenAI’s board of directors. While BlackRock's diverse fund structures explain part of this, the move underscores the complex new landscape.
Founder Pushback and Industry Norms
OpenAI CEO Sam Altman, a former president of Y Combinator, is familiar with venture capital norms. In 2024, he reportedly provided his investors with a list of OpenAI rivals he preferred they not back, including Anthropic, xAI, and Safe Superintelligence. Altman later clarified he did not threaten to bar investors from future rounds but stated that making "non-passive investments" in rivals would mean they would no longer receive OpenAI's confidential business information, according to documents cited in the lawsuit between Elon Musk and OpenAI.
Not all firms have adopted this dual-investment approach. Andreessen Horowitz backs OpenAI but not Anthropic, while Menlo Ventures backs Anthropic but not OpenAI. Other investors with stakes in only one of the two giants include Bessemer Venture Partners, General Catalyst, and Greenoaks.
A New Due Diligence Imperative
The breaking of this long-standing informal rule by respected firms like Sequoia is a notable shift in Valley culture. One investor, when questioned, simply shrugged and indicated that as long as the firm doesn't hold a board seat, many no longer see harm in the practice. However, the trend suggests that conflict-of-interest policies should become a standard point of due diligence for founders evaluating term sheets, regardless of the investor's prestige.
The record-breaking scale of AI funding, driven by immense computational and data centre needs, creates powerful financial incentives. When investment opportunities promise historically large returns, the pressure to participate can override traditional exclusivity, reshaping the relationship between venture capital and the founders they back in the process.