Is AI the new cigarettes? Our VC panel digs into Anthropic’s S-1 | E2356

October 29, 2026 · 1 h 12 min

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This Week in Startups analyzed Anthropic's S-1 filing with a VC panel, examining whether the AI economy's numbers add up. Anthropic showed operating profitability, a $72.4B non-cash accounting charge on convertible notes, and a shocking 900% net revenue retention rate. The company projects $65-80B annualized revenue with only 0.1% of corporate America's operating budgets currently spent on AI, suggesting massive headroom for growth. The debate centered on whether "intelligence is the new cigarettes"—an addictive product with unlimited demand and gross margins. Key tensions emerged: whether Anthropic's growth can sustain massive CapEx commitments, whether the company's founders are idealists or capitalists, and how enterprise adoption will scale. The panel discussed emerging managers, AI-driven entrepreneur efficiency, and the shift from traditional VC to SPVs and secondary markets.

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Today’s show:

Anthropic’s S-1 is here, and finally, we can start to develop a real understanding for the AI economy and whether the numbers add up. Anthropic shows an operating profit, a mostly non-cash $80.7 billion loss, and customers spending a shocking 9x what they were spending on intelligence just one year ago.

Is this the greatest business in history? Is AI now as addictive to enterprises as cigarettes once were to impressionable teens?

On this week’s VC Roundtable, Jason Calacanis is joined by D.A. Wallach (Time BioVentures), Dave McClure (Practical Venture Capital), and Ben Black (Akkadian Ventures / Powerlaw Corp.) to seek some answers.

They dig into the numbers, including that wild 900% net revenue retention, and consider how retail investors will consider the convertible-note charge behind their $80B loss. Plus they’ll debate whether Anthropic’s founders are really true believers driven by religious fervor, and if so, whether they’re destined to be out-competed by “rabid capitalists.”

Guests

D.A. Wallach on X: https://x.com/dawallach

Time BioVentures: https://www.timebioventures.com/

Dave McClure on X: https://x.com/davemcclure

Practical Venture Capital: https://practicalvc.com/

Trading Places podcast: https://www.youtube.com/@PracticalVentureCapital

Ben Black on LinkedIn: https://linkedin.com/in/benblack

Akkadian Ventures: https://akkadian.vc/

Powerlaw Corp: https://pwrl.com

Relevant Links

Anthropic’s S-1, by the numbers (Fortune): https://fortune.com/2026/10/27/anthropic-s1-ipo-filing-financials-profits/

900% NRR and an $80.7B loss that mostly ins’t (HackerNoon): https://hackernoon.com/anthropics-s-1-shows-163b-in-half-year-revenue-a-900percent-nrr-and-an-807b-loss-that-mostly-isnt