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“Claude, you are writing the prospectus for the launch of the largest initial public offering in history. Invent a new and highly bespoke governance structure that is safe for a technology that could pose ‘catastrophic or existential risks to humanity’ but is designed to be used for the ‘long-term benefit of humanity.’”
Anthropic plans to go public later this year with an IPO reported to value the company at $1.5 trillion to $2 trillion, surpassing the previous record-holder of about six months, SpaceX. Its S-1, released on Monday, details a governance structure that is unusual even by the standards of today’s tech companies.
The 318-page prospectus offers a series of handbrakes, in case the development of AI models outstrips the ability of the company or regulators to restrain it. However, those hurdles may also make management less responsive to public or shareholder pressure, while also introducing dysfunction if constituent parts of the oversight structure disagree with each other.
In short, investors effectively have to monitor three different boards, while remaining powerless to influence any of them.
Different class
Like a few recent trendy IPOs, including Warby Parker and Allbirds, Anthropic is a public benefit corporation (PBC), rather than the traditional Inc. or LLC designation.
PBCs are not automatically more protected from shareholder influence, but many are by design. According to Jens Dammann, a law professor at the University of Texas, there were 19 listed PBCs on or before the end of 2023 and nine of them had dual-class share structures. Only four required a supermajority to change their charter to convert to a regular business corporation or change the specified public benefit, although another 13 had supermajority voting protections for other parts of their charter.
Dual-class share structures have become increasingly common in recent years. Diligent Market Intelligence Governance data show that the number of IPOs with these structures has exploded, with double-digit numbers most years since 2015 and 288 of the 440 currently public listed in the decade spanning 2016 to 2025 (most of them in the U.S.).
Anthropic's ascension to the S&P 500 is likely a matter of time, which will draw a flood of indexed capital. Anthropic won’t necessarily fall foul of that, as S&P Dow Jones has no voting-rights hurdle for multi-class companies. Since 2023, they can be considered for the S&P 500 and related indices if they meet other tests, such as U.S. status, market-capitalization, public-float, liquidity and profitability requirements, and are selected by its committee. That policy reversed a 2017 ban, under which Snap was excluded while existing constituents including Alphabet and Meta Platforms were grandfathered in. Palantir and Apollo Global Management have since joined the index.
There is also an ongoing debate about their impact on performance. Meta Platforms, which equipped founder Mark Zuckerberg with super-voting shares, has returned over 1,500% since its IPO in May 2012. Snap, which famously issued common stock with no voting rights, has lost about 80% of its value since its March 2017 offering.
Checks and balances
Anthropic goes beyond previous examples of multi-class offerings: the company actually has five classes of stock.
There is a single share of Class F stock, owned by a company called Founder LLC, where seven individuals will decide how to cast a single vote worth 50.1% of the company’s voting power. That in itself is rare. According to Diligent Market Intelligence Governance data, only three other companies in the U.S. have a class of stock with a single share.
Common, or Class A stock, has relatively little influence given the Class F majority. Class E, owned by employees, and Class N, for strategic business partners, have limited voting power and are designed largely as incentive plans, although they have a say in the potential for conflict.
Perhaps borrowing from a Scandinavian governance trend still evident at Novo Nordisk and Carlsberg, Anthropic also introduces a philanthropic governing class to keep it on mission. A four- (soon to be five-) member board of trustees organized as a Long-Term Benefit Trust (LTBT) has the right to elect a majority of Anthropic's board through its ownership of Class T stock. Class T doesn’t vote on any other matters or have any economic interests, and, in the words of the S-1, the purpose of the LTBT is “to ensure that we are managed in a manner that responsibly balances our tripartite goals as a PBC: (i) the pecuniary interests of our stockholders, (ii) the best interests of those materially affected by our conduct, and (iii) the company purpose.”
How will it work in practice?
Anthropic is not quite one of the Silicon Valley companies that gave founders undisputed control, but it’s not quite Nordic in its approach either. You could argue that Anthropic’s governance puts its founders on top, with some checks.
The LTBT and founders effectively split the board between them, with the LTBT having a slight edge. If the nominating and governance committee of the board disagrees with the appointment or removal of a Class-T director, Class E (employee) shareholders will vote on the matter. It is as yet unclear what percentage of the Class E shares members of the founder group will own. Redeeming the Class T shares would require the approval of all three of the founder, employee and common share classes.
There is a nod to a sunset provision for Class F shares, but that is easily sidestepped by the founders and their designated successors. In the unlikely event the founders vote their control out of existence, supermajority voting requirements and board classification kick in to prevent the governance structure from being too rapidly overhauled by common shareholders.
Moreover, the structures overlap. Anthropic says the LTBT is “financially disinterested” because its stock has no economic value, although the company itself funds the LTBT and pays each trustee $400,000 per year and has made a philanthropic donation to a charity run by one of the trustees.
As for the founders, these include CEO Dario Amodei and his sister, Daniela, who serves as board chair. Siblings have been known to fall out before, and not just in Succession.
The founders have pledged to dedicate 80% of their equity to philanthropic causes, although the timing and mechanism of this pledge, which could lead to margin calls, are unclear. The benefit of the extremely small class of founder stock is that control can't be divided or diluted. Elsewhere, a similar need has led boards to get creative; in October, following the proposal of a wealth tax in California, Meta Platforms issued a new non-voting share class that founder Mark Zuckerberg can monetize without diluting his control of the company.
Token governance
Given investor demand for ownership of the leading AI models (OpenAI remains private to date), this offering is unlikely to go the way of WeWork’s aborted IPO in 2019, when scrutiny of the company’s governance and financial positions led to fading demand for shares.
Anthropic is clear that it is a controlled company, and as such its board is not required to be independent. Given that corporate governance is a case of preparing for the unexpected, it is difficult to predict how Anthropic's governance will be tested, or what it will look like in 10 years.
But it might also be worth reflecting on Allbirds, another public benefit corporation with dual-class shares that unexpectedly sold its sneaker business earlier this year to pivot to AI infrastructure, having lost almost all of its $2.2 billion market capitalization at IPO. Diligent Market Intelligence Voting data show the proposal was almost universally approved at the special meeting over the summer, but choice was something of an illusion; 71% of the votes were locked up on the day the plan was announced.
The stakes here are much higher. Just ask Anthropic.
