The AI Race:
Situational Awareness’ AI Bets
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By Natasha Mascarenhas, Rebecca Torrence, and Edward Ludlow
August 5, 2026 at 4:35 PM EDT
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Sequoia Capital’s new leaders convened the partnership at a conference room in its Silicon Valley headquarters one Monday morning in May to debate what would be the biggest investment in the venture firm’s 54-year history. Sequoia had spent years passing up the chance to bet on the artificial intelligence darling Anthropic PBC, favoring OpenAI, xAI and other AI startups instead. In January it changed course and invested in the company. Now it had decided to increase its stake. The only question was how much more it would put down.
Alfred Lin, who’d taken over co-leadership of the firm in November 2025, initially endorsed the idea that Sequoia invest $1 billion. But Anthropic’s business was so extraordinary, other partners reasoned, that they should swing for the fences. Pat Grady, Lin’s “co-steward,” suggested going bigger.
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