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As Anthropic and OpenAI dominate the headlines, plenty of younger AI companies are nipping at their heels.
Those companies are still able to raise gobs of cash from venture capitalists and other investors at ever-higher valuations (despite concerns of overspending and the risk of an AI bubble) as investor enthusiasm for AI outruns its immediate business prospects.
Most of the money is being used to buy computing power for start-ups’ own data centers or outside cloud computing. Ultimately, that means the money fuels higher sales of Nvidia graphics processing units, as well as central processing units and memory.
Anthropic is valued at $1.2 trillion, followed by OpenAI’s $852 billion. Both Anthropic and OpenAI expect to go public at far higher valuations.
Other top companies are Databricks, Cognition, Ramp, Thinking Machines Lab, Project Prometheus, Safe Superintelligence, VAST Data, Perplexity and Sierra. China’s ByteDance, the owner of TikTok, has a valuation of $480 billion. China’s DeepSeek is valued at $59 billion.
Private valuations are a moving target. These days, the target is moving steadily higher, as new funding rounds from eager investors push valuations up.
Anthropic | $1,200B |
OpenAI | $852B |
Databricks | $190B |
Cognition | $48B |
Thinking Machines Lab | $45B |
Project Prometheus | $41B |
Safe Superintelligence | $32B |
VAST Data | $30B |
Perplexity | $20B |
Sierra | $16B |
Sources: CB Insights, “State of AI: Q3 2025”; company press releases; news reports
Some highly valued start-ups have tiny staffs and no product or revenue, at least not yet, with investors betting big on the founders as visionaries. Others have soaring sales, as is the case with leaders Anthropic and OpenAI, but are spending even faster than revenue is rising.
The different solutions highlight the varied AI ecosystem. Databricks is a cloud platform for massive amounts of data and analytics, for example. Project Prometheus, which is backed by Amazon founder Jeff Bezos, focuses on robotics and other physical hardware. Perplexity has a free AI-powered search engine.
Investors are betting that there’s room for many winners in the AI race.
This forecast first appeared in The Kiplinger Letter, which has been running since 1923 and is a collection of concise weekly forecasts on business and economic trends, as well as what to expect from Washington, to help you understand what’s coming up to make the most of your investments and your money. Subscribe to The Kiplinger Letter.