The unwritten rules of venture capital are getting rewritten in real-time. At least a dozen prominent VCs are now backing both OpenAI and Anthropic simultaneously, a move that would have been considered a serious conflict of interest just a few years ago. The dual investments signal a seismic shift in Silicon Valley ethics as firms abandon traditional loyalty principles to hedge their bets in the AI arms race.
Venture capital used to operate on a simple principle: you pick your horse and ride it to the finish line. But in the AI race, investors are now mounting multiple horses at once. The discovery that at least a dozen venture firms are simultaneously backing both OpenAI and Anthropic reveals just how dramatically the rules have changed.
The dual-backing strategy would have been unthinkable in previous tech cycles. When Uber and Lyft were battling for rideshare dominance, or when Airbnb competed with other home-sharing platforms, VCs largely chose sides. Backing direct competitors wasn't just considered poor form - it was seen as an ethical violation that could compromise board confidentiality and strategic guidance.
But AI is different. The market opportunity is so massive, and the capital requirements so enormous, that traditional investor loyalty has become a luxury few firms can afford. Founders Fund, the influential firm co-founded by Peter Thiel, is among those hedging its bets across both companies. ICONIQ, the secretive investment firm with deep ties to tech executives, has also placed chips on both sides of the table.
The parallels to the search engine wars of the early 2000s are striking, but with a crucial difference. Back then, venture firms largely committed to either Google or its competitors. Today's AI investors are operating under what might be called the "mega-round exception" - when funding rounds reach billions of dollars and valuations soar into the tens of billions, the normal rules apparently don't apply.
