Ellen Thomas | The Verge

Silicon Valley wants you to invest in miracles

2026-10-30T17:33:57-04:00

Investing in any stock is kind of like gambling in the sense that you’re betting your money on a company’s future performance. But how do you bet on a technology that could, in the worst-case scenario, “pose catastrophic or existential risks to humanity,” or best case, “bring forth an age of miracles”?

To some extent, Anthropic suggests in a letter at the top of its S-1 filing, you have to just believe.

Anthropic’s 335-page S-1 prospectus, filed Monday, is part of a steady hype escalation in Silicon Valley’s interactions with Wall Street. In some ways, it’s not even that bizarre; SpaceX IPO’d in June after filing an S-1 that referenced dinosaurs and “colonizing Mars.” But its sweeping language and sheer volume — including 94 pages of risk factors — is a sometimes overwhelming collision of AI industry rhetoric and a hard financial pitch. Out-of-this-world promises are integral to Anthropic’s survival as a company. That doesn’t make reading the S-1 any less surreal.

In the letter, Anthropic’s founders urge prospective stock owners “not to think of your purchase in purely transactional terms. We hope you will see it instead as an opportunity to be part of something greater.” The march toward advanced AI “is one of the seminal moments in human history,” the letter says. “Our aim is to help humankind chart a safe course through this technological evolution, open new frontiers of discovery, and bring forth an age of miracles.” But the S-1 warns that if things go wrong, the consequences could be disastrous — even an “existential” risk to humanity. Many dangers are laid out in exhaustive detail, including risks that models “behave in ways that no user or developer intended,” leading to “catastrophic” incidents that the entire insurance industry couldn’t afford to underwrite.

Tech startups preparing to go public haven’t always used the information overload approach. “In 1980, a highly touted company called Apple Computer went public. Its prospectus, which I have, is 47 pages long with zero risk factors,” said Jay R. Ritter, a professor at the University of Florida’s Warrington College of Business. “If you go back and read it, it’s incredibly simple.”

Ritter pointed to Facebook’s S-1 filing as a turning point. The company now known as Meta filed a 200-page prospectus with 22 pages of risk factors. CEO Mark Zuckerberg’s letter to investors was a manifesto on his move-fast-and-break-things approach to growth, which he dubbed “The Hacker Way.”

While the idea might be to cover all possible bases, “a problem with this bloat is that it’s become more and more difficult to find the nuggets of what’s important,” Ritter said. “You know, I don’t know if you’re like me, but the longer it is, the less inclined I am to read it.”

Anthropic’s founders explain in their investor letter that oversharing is part of their “anti-sell” strategy, designed to attract long-term investors who believe in their vision.

“It is very dangerous when people buy your company’s stock based on expectations you cannot fulfill or on incorrect predictions about how you will behave. This is in fact very similar to one of Anthropic’s guiding principles: underpromise and overdeliver,” the founders’ letter says.

Some of the statements in Anthropic’s S-1 read as surprising admissions. “We may make forward investments that may seem irresponsibly large,” for instance, or “model safety, interpretability, alignment, and welfare may lead us to limit or delay the deprecation of older models.” Maybe none of this should be surprising, considering the founders do warn readers about the company’s policy of practicing “radical honesty.”

Anthropic’s ‘radical honesty’ includes being open about the prospects of human extinction

This policy led to the biggest jumpscare of the whole filing, on page 46:

“Concerns have been raised both within our organization and by other researchers, regulators, policymakers, and industry participants that, if not developed, deployed, and operated with appropriate safeguards, oversight, and security measures, pose catastrophic or existential risks to humanity.”

Followed quickly by:

“Our development of highly advanced models, platforms, and applications and expansion of use cases could further increase the risk that our models cause harm.”

Anthropic has famously been a proponent of doomsday AI scenarios. CEO Dario Amodei has said there’s an up to 25 percent chance that further AI development could lead to human extinction.

The heart of Anthropic’s pitch — or anti-sell — is that despite the risks, it is absolutely committed to developing safe and secure AI technology. After all, it will go public as a public benefit corporation, a type of business entity that, unlike C-corporations that are required to maximize shareholder value, must prioritize a social mission alongside shareholder interests.

“Powerful AI” — Anthropic’s term for hypothetical future AI that surpasses collective human intelligence — is presented in the company’s S-1 as inevitable. If this technology is coming no matter what, then Anthropic, a public benefit corporation, should lead the charge. But Anthropic will need a lot of money, possibly an unlimited amount, to do this. And more practically, as Liz Lopatto has written, powerful AI (in the form of dramatic recursive self-improvement) might be about the only way Anthropic can stay ahead of the competition and survive.

“All of us have a sincere conviction that the AI exponential will generate so much value, that, in the long run, it will far outweigh any shorter-term economic sacrifices we make as part of our mission,” the letter says.

For all the information the company made available in its S-1, there are some gaps. Crucial information that could be used to assess profitability — third quarter results, for instance — is missing. Anthropic saw explosive revenue growth in the second quarter, but the second quarter was also the height of tokenmaxxing, which could have led to a surge in sales. Some corporate executives have warned that AI costs are surging out of control. While Anthropic’s operating losses narrowed in the second quarter, the S-1 also revealed hundreds of billions of dollars in financial obligations to secure the computing power it says it needs to keep growing. It also said it will start building its own data center infrastructure, a costly move that would eat into profit.

Ritter thinks Anthropic will likely share its third quarter results the closer it gets to an IPO date. And besides, he added, “nobody knows” what will happen once a company goes public, including the company itself. It’s all a gamble in that sense.

Anthropic isn’t WeWork… although never making money is on its list of risk factors, of course

“For its first 22 years, Apple was largely a failure as far as investors were concerned,” Ritter said. “In its first three years, it greatly underperformed the market. And now it’s worth what, $5 trillion?”

When WeWork filed its S-1 in 2019, it was skewered for using lofty rhetoric. A line about the company’s aim to “elevate the world’s consciousness” was especially roasted.

That was different, Ritter said. WeWork was “a money-losing real estate company pretending to be a tech company at a ridiculously high valuation.”

“There was no chance of ever making huge profits in the future.”

Technically, that’s a risk for Anthropic too. It’s on page 63 of the S-1.

“We have a history of net losses and may not generate sufficient revenue to achieve or sustain profitability in the future.”

Then again, this is the age of miracles.

In Meta’s version of the future, I’ll have my Muse call your Muse

2026-10-22T16:30:41-04:00

Mark Zuckerberg is barrelling toward a future in which an autonomous network of AI agents will run our lives — shopping for us, working for us, talking to other people’s AI agents for us. Are humans ready for this very specific and unrelenting vision of a life in which we communicate primarily through bot proxies? Actually, don’t answer that. The more urgent question coming off Meta’s quarterly earnings call Wednesday night is more likely to be: “Is he?”

Zuckerberg is staking Meta’s future on Muse, the personal AI agent it released to the general public last month. It’s early days, but Zuckerberg told investors during Wednesday’s call that he sees a future where “billions” of people are using Muse, and those people’s Muses are talking to and transacting with other people’s Muses in a “large-scale Muse network.”

The Muses will be “extremely capable” personal agents that will help us achieve our goals and improve our lives in “whatever ways you want,” Zuckerberg said during the call, “whether that’s improving your relationships, helping you save time, save money, build a business, create new things, or anything else that you can dream of.” By this logic, Zuckerberg says, we’ll all be so hooked on Muse that it will eventually generate more revenue per user for Meta than Instagram and Facebook, which, as of today, bring in pretty much all the money Meta makes.

This ecosystem of personal AI agents “can work with your friends and your families, and if you want to buy something, it’s not just navigating to that business’s website; it’s talking to their agent,” Zuckerberg said. “I think that getting that all to work well together is going to unlock tremendous value at scale.”

Zuckerberg predicts that Muse will be “highly profitable” in just a few years.

All of this should sound great — if not a little freaky — to investors, who probably tuned in to Meta’s call hoping Zuckerberg would have some justification for the hundreds of billions of dollars his company is currently spending on AI data centers. But if anyone was hoping for more than a concept of a plan, they didn’t get one.

To be fair to Muse, Zuckerberg shared a few promising data points. To date, the app has been downloaded and set up by more than 10 million users in the US and Canada, making it one of Meta’s “most successful launches ever,” according to Zuckerberg. He did not share specific retention numbers but said that a quarter of people who downloaded Muse initially are using it daily. He sees the biggest opportunity in commerce: A quarter of Muse users are shopping through the platform, Zuckerberg said, and are spending, on average, more than $200 per purchase.

Meta earns a fee for every commercial transaction that takes place on Muse. Zuckerberg’s thinking seems to be that if AI agents are doing the shopping, the potential number of transactions that could take place on the platform is, essentially, unlimited. Unlike the average consumer, AI agents don’t sleep. In theory, they’re available 24/7 to scrape the Internet, generate product recommendations, and buy things, constantly, in real time.

Meta didn’t offer any details as to how all of this will actually work in practice, which makes sense given the very legitimate concerns about how the company handles data privacy. In September, a YouTuber said his Muse agent sent a stranger to his home in the middle of the night while arranging a Facebook Marketplace transaction on his behalf. When Muse launched last month, Zuckerberg claimed it was “built for privacy and security from the ground up,” but there have been reports of agents leaking content from users’ private conversations. A Canadian bank executive told Bloomberg earlier this week that it would consider blocking Muse from accessing its customers’ financial data.

Zuckerberg seems to think if people get on board with Muse, enterprise will have to follow. But, what if people don’t want to? What if they can’t afford to? Someone has to pay for all the stuff the bots are buying in this fever dream of a never-ending, Supermarket Sweep episode taking place inside our phones — or Muse Charms, if you’d rather. New research from the University of Michigan shows that consumer sentiment in the US is at an all-time low as gas prices and inflation continue to creep up.

If Meta knows that all of this sounds dystopian and a little bizarre, it does not care.

“Agents are going to be an important part of how reality evolves, and everyone is just going to have to adapt,” Meta’s CFO Susan Li said when one investor on the call asked about potential “friction points” in getting businesses on board with the Muse plan. After all, Meta says Muse will likely remain free for consumers, while businesses will be expected to cover the transaction fees.

Meta really does need Muse to work. The company’s capex is through the roof, and other financial obligations are piling up. It plans to spend between $135 billion and $145 billion in 2026, double what it spent last year. As of yesterday, it owes New Mexico $25 billion after a jury found it had violated the state’s consumer protection laws. Meta, and the rest of Big Tech for that matter, is under increasing pressure to show that its AI investments will be worth it.

Forget consumers — it’s not clear if Meta itself can afford its plans. Zuckerberg stated clearly on the call that the reason it hasn’t launched Muse internationally is because of compute efficiency.

It’s incredibly expensive and energy-intensive to run GPUs at the level that a network of Muses would require, and Meta seems to have reached the limit of what it can achieve with its current data center operations. Zuckerberg told investors the plan is to “10x” the cost-efficiency of its compute next year. He didn’t explain how the company plans to do this. Luckily for him — and possibly the rest of us — there is already research on how data centers can maximize compute capacity with energy-use strategies that also reduce strain on the electric grid. Maybe he’ll read it.

Ultimately, Muse won’t be profitable and won’t succeed if Meta can’t figure out how to get its compute costs down. Zuckerberg said it himself.

“One of the biggest constraints so far is that because this is a compute-intensive service to run, we haven’t launched it globally,” Zuckerberg told an investor who asked about the “limiting factors” he sees in growing Muse’s user base.

Muse’s 10 million downloads since launch are even more impressive considering they came only from the US and Canada, Zuckerberg said, adding, “If we actually did roll it out more broadly, then you would expect that number to be significantly larger than what we’re seeing today.”

Zuckerberg at least seems to understand that some people — and, probably more importantly for him, some businesses — won’t immediately “get” Muse. That’s okay, he said. “We’ll work with folks on the terms that make sense for them,” he said. “I do think that over time, this is going to be quite valuable for everyone.”

Then again, this is the same guy who brought you the Metaverse. We’ll see what happens.