Good day. Anthropic hit a valuation of $965 billion at the drop of a hat. Lead investors signed onto the deal about two weeks ago, people familiar with the situation said. After that, investors had to wire the money stat, making for an unusually fast process.

“The speed from them not actively raising to a signed term sheet and $65 billion closed was beyond unprecedented,” said Matt Murphy, partner at Menlo Ventures, an investor in Anthropic.

Anthropic has reached a near-$1 trillion valuation faster than any venture-backed company on record, measured from its first product launch, hitting that mark roughly three years and two months after Claude debuted in March 2023, according to PitchBook Data.

We’d like to hear from you. How are timelines changing in the venture market, whether in terms of deal processes, revenue growth or even pivots and shutdowns. What did you have to change in your process to adjust to the new marks on the speedometer? Please email vcnews@wsj.com.

Last week, we asked whether venture investors should take board seats. Here are your responses, edited for length and clarity:

• Matthew Cheng, co-founder and chief executive, Kanvas Biosciences: Our early investor [Jason Pontin, general partner at DCVC] leads our board. The relationship has never been about control. It’s about accountability, yes. But more than that, it’s about partnership and access to experienced operators who have seen similar challenges before.
   
• Zachary Aarons, co-founder and general partner at MetaProp: We are in favor of earlier-stage firms cycling off boards as directors as the company progresses past series B but staying on as observers to maintain continuity and institutional knowledge. As an observer, a VC can advise founders on strategy at the board level without having to cast a vote that potentially forces them to choose between their fiduciary responsibility to company shareholders as a board director and their fiduciary responsibility to limited partners as a general partner of a venture-capital fund.
   
• Said Mia, managing partner, Stormbreaker Ventures: Because we lead rounds, we do take board seats selectively when the founder wants an active thought partner in the room, but we’ve never treated the seat as a condition of the check.
   
• Anis Uzzaman, founder and CEO at Pegasus Tech Ventures: Board seats still carry significant weight. That said, over the years, there has been a clear shift toward founder alignment rather than just investor control. Strong relationships and the ability to help founders scale their businesses effectively often create more influence than a board seat itself.

And now on to the news...

AI Showdown. AI startup Anthropic closed a funding round at a $965 billion valuation, rocketing past ChatGPT-maker OpenAI as the companies race ahead on expected public listings this year.

The company has emerged as the front-runner in the AI race and is on track next month to hit $50 billion in “annualized revenue”—a metric startups use that employs short-term sales to forecast a yearly figure. That figure grew 80-fold in the first quarter.

Anthropic, founded in 2021 by Dario Amodei and others who decamped from OpenAI, raised $65 billion from investors including Altimeter Capital, Dragoneer, Greenoaks, Sequoia Capital and others, about half OpenAI’s tally that closed earlier this year.

The Trump administration is pursuing funding deals with a group of drone companies as part of its effort to increase domestic production and lower the costs of the increasingly vital weapons, people familiar with the matter said.

• Among the companies the Pentagon has identified for possible funding are Performance Drone Works, which won a contract to supply the Army with reconnaissance drones; Unusual Machines, a drone components supplier that counts Donald Trump Jr. as a shareholder and advisory board member; and Neros Technologies, a Sequoia Capital-backed startup building small first-person view drones, some of the people familiar with the matter said.

Christina Ho, a dissenting voice on the U.S. audit regulator’s board in recent years, is helping form a new venture-backed accounting firm.

• Ho, who left the Public Company Accounting Oversight Board in January, recently joined Oath, a new firm that aims to automate 80% of its work by 2030 as it integrates artificial-intelligence tools. She serves as chief assurance officer at the firm, which will provide auditing and advisory services, but not tax services.
   
• “The audit approach is still built around human limitation and so in order to truly realize the benefit of technology, you have to build an audit methodology that is not human-centric but machine-centric,” Ho said.

People

DataVisor, a real-time decisioning platform for fraud and financial crime prevention, appointed Patrick Harr as chief executive officer. He most recently served as CEO of  SlashNext.

Healthcare technology provider Stellar Health appointed Falko Buttler as chief technology officer. He was most recently CTO of Lantern.

Exits

Imperial Brands acquired Black Buffalo, a creator of smokeless tobacco alternative products, for an initial consideration of $150 million. The transaction includes the possibility of an additional deferred sum based on performance over three years and other criteria.

Cognition, a San Francisco-based AI coding startup, grabbed more than $1 billion in new funding at a $26 billion valuation. Lux Capital, General Catalyst and 8VC co-led the investment, which saw participation from Founders Fund and Bain Capital Ventures.

Fonoa, a Dublin-based startup building an AI-powered tax operating system for multinational businesses, raised $110 million in Series C funding. The company also said it acquired Indirect Tax Edge from PricewaterhouseCoopers. Headline led the investment, which included additional support from Eurazeo, Forestay Capital, Index Ventures and Dawn Capital.

Corgi, a San Francisco-based insurance platform for startups, added $106 million in Series B1 funding led by TCV, bringing the company’s valuation to $2.6 billion. This latest investment comes less than one month after Corgi raised $160 million in Series B financing.

Garner Health, a New York-based digital platform that helps patients find healthcare providers, completed a $100 million Series E round, bringing the company’s valuation to $2.74 billion. Index Ventures led the funding, which included contributions from Kleiner Perkins, Redpoint Ventures, Thrive Capital and Sequoia Capital.

Thea Energy, a Switzerland-based startup building a fusion energy system, scored $100 million in Series B funding from investors including US Innovative Technology Fund, Linse Capital, Calm Ventures, Climate Capital, Divergent Capital and Emerald Technology Ventures.

Reactor, a San Francisco-headquartered developer platform for real-time generative video, emerged from stealth with $59 million in funding. Led by Lightspeed Venture Partners, the investment included participation from FPV Ventures and others. 

Orbital Industries, a London-based industrial startup using frontier AI to design, manufacture and ship physical products, snagged $50 million in Series B funding. Plural led the round, which included additional support from NVentures, Radical Ventures, Compound and Fly Ventures.

Daloopa, a New York-based startup building data infrastructure for AI and agentic workflows in finance, nabbed $47 million in Series C funding. Brighton Park Capital led the round, which included participation from Squarepoint Capital, Touring Capital and Nexus Venture Partners.

Pace, a New York-based AI operations platform for insurance, secured $46 million in Series B financing. Thrive Capital and Sequoia Capital co-led the round, which included contributions from Emergence Capital Partners and Pruven Capital.

Gray Swan, a Pittsburgh-based AI security startup used by frontier labs, landed $40 million in Series A funding. Wing Venture Capital and Madrona co-led the round, which included participation from Obvious Ventures, Snowflake Ventures, Samsung Next and others.

H1, a New York-based platform that helps identify and engage the right doctors for critical workflows, picked up a $40 million investment led by CVS Health Ventures.

Pax, a Brazil-based startup building real-time intelligence platforms for public safety, was seeded with a $40 million investment co-led by Greenoaks and Benchmark.

Canals, a Miami-based startup that automates workflows across wholesale distribution, collected a $35 million investment led by Base10 Partners.

Geordie AI, a security and governance platform for AI agents with offices in London and New York, closed a $30 million Series A round. Balderton Capital led the investment, with Partner James Wise joining the company’s board.

• Big Subsidies for Google, Limited Water for Locals: The Dilemma of AI in India
   
• How Online Sleuthing Helped Catch the ‘Google Insider’ on Polymarket
   
• Trump Regulator Moves to Drop Case That Drew Ire of Winklevoss Twins
   
• France’s Answer to OpenAI Warns of Dangers of U.S. Tech Dominance
   
• AI Is Changing How Consultants Get Paid—and Much More, BCG’s CEO Says
   
• The Chip Rally Is at $5.7 Trillion and Counting. How Much Further Can It Go?
   
• IBM, Red Hat Pledge $5 Billion for AI-Driven Open Source Security Initiative
   
• Renown Capital Partners Doubles Down on Backing Power-Tech Company Utilidata

This newsletter was compiled by Yuliya Chernova and Zachary Cole.

Share your tips, comments and questions: vcnews@wsj.com

The team: Matthew Strozier, Yuliya Chernova, and Brian Gormley.

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