Good morning and welcome to FirstFT. In today’s newsletter:
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Anthropic investors bet on $2tn valuation in record IPO
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Karoline Leavitt steps down
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Women buy their own diamonds now, says Swarovski boss
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Wanted: a leader to rescue the UN
You can listen to today’s top news stories in the FT News Briefing podcast.
Anthropic investors expect the AI start-up to float at a valuation of $2tn or more in October, a figure that would vault it past SpaceX to make its debut the largest-ever initial public offering.
Half a dozen of the company’s backers told the FT that Anthropic’s rapidly rising revenue would enable it to more than double its current valuation.
A listing at that level could unlock billions of dollars in gains for the five-year-old company’s early investors but would also test public markets that are becoming more nervous about the AI boom.
Anthropic’s backers say demand for the lab’s advanced AI models and tools justifies their lofty expectations. Investors expect the Claude maker’s annualised revenue to be between $100bn and $120bn by the end of 2026, up by more than 10 times over the course of the year.
Their bullish projections come despite mounting challenges, including rising competition from Chinese rivals, pressure for AI regulation and a simmering feud with the US government.
Meanwhile, legal AI start-up Legora is looking to raise funds at a valuation roughly double the $5.6bn it achieved only four months ago. The Swedish start-up is in the early stages of discussions with investors at a valuation of at least $10bn.
Wall Street is betting that the chips powering the AI boom will remain higher for longer.
Nvidia this week unveiled a $500bn deal under which tech groups will be able to lease semiconductors with financing from groups including Apollo Global, KKR, Brookfield, BlackRock and Goldman Sachs.
Jensen Huang, Nvidia chief executive, has said the partnership between the technology company and the financial services industry will create a new asset class backed by chips.
Investment industry titans, including Blackstone’s Jon Gray and BlackRock’s Larry Fink, have similarly said that their firms are keen to deploy capital to tap into the insatiable appetite for new data centres to train and power the latest AI models.
But the new funding model also comes with the risk that financiers misjudge the durability of demand for — and the value of — Nvidia’s chips.
Wealth managers, meanwhile, are cutting fees and hiring staff around Silicon Valley in a rush to win over workers at Anthropic and rival lab OpenAI before their initial public offerings mint a new class of millionaires.
Morgan Stanley’s wealth management division last quarter took in more than $74bn in net new assets from IPOs after SpaceX completed its blockbuster listing, through its work managing employee equity plans.
Here’s what we’re keeping tabs on today:
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Live Q&A: Business columnist Pilita Clark and climate correspondent Attracta Mooney answer readers’ questions at 1pm (BST) on this summer’s extreme climate. Is it the new normal? Submit your questions here.
Five more top stories
1. Karoline Leavitt, the White House press secretary, will leave her role at the end of August, Donald Trump has announced. Leavitt, who has staunchly defended the US president and his agenda, will step down but remain a “top outside advisor”, Trump said.
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Go deeper: The first member of Gen Z to hold the position spoke for her octogenarian boss far more effectively than her forerunners, writes Joe Miller.
2. Insurers controlled by Mark Walter have been racing to divest outsized holdings of private credit loans linked to other parts of his investment portfolio, according to people familiar with their plans. Rob Camacho, who joined Walter’s firm TWG Global from Blackstone two years ago, has approached investors in recent weeks to refinance some of the loans held by insurers Delaware Life and Clear Spring Life and Annuity.
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Lakers sale: Walt Disney’s former chief executive Bob Iger and Josh Kushner, whose brother is Donald Trump’s son-in-law, are buying the Los Angeles Lakers basketball franchise for $12.5bn from Mark Walter.
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More M&A news: Nelson Peltz’s Trian Fund Management is laying the groundwork for a take-private bid for US fast-food chain Wendy’s with backing from a consortium of investors including Bugatti backer BlueFive Capital.
3. The UK economy grew by 0.4 per cent in the second quarter, a relatively robust performance that suggests businesses are weathering threats including the Gulf-related surge in energy prices. The figure will come as a relief to new Prime Minister Andy Burnham as he pledges to broaden growth across more of the country and tackle the cost of living crisis.
4. Women are buying their own diamonds now, the chief executive of jewellery maker Swarovski has said. Lab-grown options were “enabling self-purchase” compared with traditional mined diamonds, “where in most instances it was a man offering a ring to a woman”, said Alexis Nasard.
5. N Chandrasekaran’s announcement yesterday that he would step down in February from running the $280bn clothes-to-Range-Rovers Tata group marked a victory for family scion Noel Tata, the 69-year-old head of the charitable trusts that control the conglomerate. “This is very much the beginning of the Noel Tata era,” said one fund manager.
The race to be the next UN secretary-general
Whoever takes over from two-term UN secretary-general António Guterres on January 1 faces a battle not just over the UN’s relevance but ultimately its survival. The very idea of multilateralism, the underlying principle of the UN, is in steep decline. Then there is the lack of money. Into this quagmire have stepped seven candidates aspiring to save the organisation, writes foreign editor Alex Russell.
We’re also reading . . .
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Taxing trade: The Trump administration’s tariff regime undermines the income the US receives from deploying knowledge abroad, writes Ricardo Hausmann, professor at the Harvard Kennedy School.
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US politics: If the left could separate economics from culture, capitalism would have more to fear, argues Janan Ganesh.
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Out of office: Summer holiday email messages are bouncing back into inboxes. Soumaya Keynes deciphers what they really mean.
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J Crew: When Kevin Ulrich’s hedge fund Anchorage Capital took J Crew from bankruptcy, the fashion brand appeared to have turned a corner. Two years later it is loaded with debt and there is turmoil in its executive ranks.
Chart of the day
US pollsters have come under fire this week for failing to predict David Crowley, a moderate Democrat, would defeat democratic socialist Francesca Wong in the gubernatorial primary in Wisconsin. The huge miss, following a similar outcome in the party’s Michigan primary last week, throws into doubt predictions for the midterms in November.
Experts point to a variety of factors for the false results, including the rise of online polls over phone calls.
Take a break from the news . . .
A lot can change when you return to work after a baby — including what you want to wear. Harriet Clarfelt, the FT’s US asset management correspondent, shares the advice she received for a post-maternity wardrobe.
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