Valuations Up, Margins Down

Public markets were flattish over the past week, with the S&P500/Nasdaq100 0%/+1%. YTD the S&P500/Nasdaq100 are now +12/+14%. In our view, positive performance was driven by continued optimism about the prospects for rate cuts, beginning with the next Fed meeting on 9/17, despite inflation data on 9/11 that was “hotter” than expected. Our NPM Private Market Tracker*, which shows the estimated average price performance of the 50 largest names in our internal Tape D® data, is now +33% YTD, slightly lower on the week. (Source: NPM; Bloomberg)

The LLM/AI infrastructure industry was front and center this week, with Anthropic and Oracle emerging as key winners. Notably, Anthropic announced a $13bn raise, bringing its valuation to ~$183bn, a ~3x increase vs. $62bn for the prior round in 3/25. Their ARR has reportedly grown from $1bn to $5bn in the past year, reflecting deepening enterprise adoption, including an announcement from MSFT on 9/10 that it was adding Anthropic to Office 365. The latter is a notable shift, as it reflects Microsoft’s willingness to adopt a multi-model strategy and source AI capabilities externally — even through Amazon Web Services, which hosts Anthropic’s Claude and is a key competitor to Microsoft Azure. (Source: Bloomberg, NPM; The Information)

On the infrastructure side, Oracle stock was +36% following announcements of new AI cloud contracts, including one worth $300bn over 5 years for OpenAI. Oracle also outlined aggressive projections, targeting $144bn in annual cloud infrastructure revenue by 2030. Oracle, historically seen as a laggard in the cloud space, has now emerged as a major player in AI infrastructure. (Source: Bloomberg; The Information)

​​​​Late on 9/11, OpenAI responded to growing scrutiny around its restructuring by announcing it had reached a non-binding understanding with Microsoft to amend their economic relationship. OpenAI also indicated that it planned to transfer an approximate 20% stake (~$100bn in value) to the non-profit entity that currently manages the company. This news came on the heels of financial projections released in conjunction with the recent secondary at a $500bn EV (up from $300bn in 3/25), which suggest OpenAI expects to burn $115bn through 2029. This figure is +$80bn vs. the prior forecast, and highlights growing capital intensity in the space. (Source: Mashable; Techspot; The Information; New York Times)

BIGGEST MOVERS AND TOPICAL NAMES

Based on our proprietary Tape D® data, the best performers of the large cap names in the private market thus far in 2025 have been Anthropic (+249% share price performance), Payward (aka Kraken; +163%) and x.AI (+144%). (Source: NPM)

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RECENT EVENTS

• OpenAI and Microsoft announced a non-binding memorandum of intent to alter their technology and financial sharing arrangements. (9/11; Bloomberg)
• Anthropic agreed to pay $1.5bn to settle a copyright infringement lawsuit. (9/5; New York Times)
• The EU imposed a $3.5bn fine on Google and suggested it may force a potential breakup. (9/5; StrictlyVC)
• Fed rate cut expectations climb for next Fed meeting on 9/17. (9/11; Bloomberg)

NOTABLE CAPITAL RAISES

• AI data company Mercor is in talks to raise new capital at a $10bn+ valuation. (9/9; StrictlyVC)
• Nasdaq agreed to buy $50mm of shares in Gemini, the Winklevoss backed crypto exchange, at the time of the IPO. (9/9; Reuters)
• AI infrastructure firm Baseten raised $150mm at a $2.15bn valuation. (9/11; StrictlyVC)
• Robotics startup Physical Intelligence in talks to raise capital at a $5bn valuation. (9/10; The Information)

NOTABLE EXITS

• OpenAI has raised the size of its employee tender to $10.3bn (9/4; The Information)​​​