In a landmark early bet on AI, Menlo Ventures backed Anthropic, a move that later valued the firm’s stake near $14 billion as Anthropic grew into a major OpenAI rival.

As Anthropic’s trajectory accelerated, Menlo’s strategic investment helped fuel a broader AI push, including the launch of the Menlo Anthology Fund and a $3 billion fundraising push.

Anthropic’s valuation and growth surged after Menlo participated in Series C and led a large portion of the Series D through an SPV, even though Menlo did not lead the Series C.

Anthropic evolved into a multi-billion-dollar opportunity, with Menlo actively involved in late-stage funding rounds despite initial hesitations.

Murphy later reflected on the lessons from the deal, acknowledging the tension between traditional rules and the potential of backing a competitive challenger to OpenAI.

Anthropic’s leadership under Dario Amodei, coupled with partnerships with Google and Amazon, underscored a mission-driven, technologist-led approach that appealed to Menlo.

A brief five-minute Zoom with Dario Amodei convinced Menlo partner Matt Murphy of Anthropic’s potential as a major OpenAI competitor, propelling a bold investment decision.

Despite initial skepticism about pre-revenue status and a lofty valuation, the quick Zoom convinced Murphy to invest.

Anthropic’s revenue trajectory exploded from near zero to roughly $100 million ARR, then to about $1 billion in a year, driven by Claude model adoption and key partnerships.

The Anthropic opportunity mirrors a broader trend: AI bets are reshaping venture investing, with investors willing to bend traditional rules for high-potential AI startups amid intensifying competition.

Menlo led Anthropic’s Series D, the largest single investment in the firm’s history, funded in part via an SPV due to size exceeding standard allocations.

Taken together, the Anthropic bet signaled a high-stakes victory for Menlo, elevating its profile and influence in the venture ecosystem.