It's more insidious than that. These IPOs aren't being rushed, they were waiting for all the pieces to be in place to force 401ks and other retirement plans to buy these IPOs.
The most recent change was the NASDAQ adopting the "fast change rule" which allows newly IPO'd companies to be listed in the index after only 15 days of trading. This rule was decided March 30, 2026 and only came into effect May 1, 2026.
The plan is to rapidly drive these prices up in the first 15 days, get the companies listed in the NASDAQ so funds are forced to purchase them at higher prices, then leave retirement accounts holding the bag.
> The most recent change was the NASDAQ adopting the "fast change rule" which allows newly IPO'd companies to be listed in the index after only 15 days of trading.
Official justification, and other changes besides timeframe, e.g.:
> First, eligibility and company size. As multi‑class share structures have become more common, we now consider both listed and unlisted shares when determining eligibility and ranking. This allows the index to reflect a company's full economic size, while index weighting remains based solely on listed shares. This change affects who qualifies for inclusion, not how constituents are weighted.
> A new method to calculate the market capitalization of companies to determine their eligibility for inclusion in the index. It involves adding listed stock and unlisted shares that are part of different share classes. Scrapping a rule that requires companies to float a minimum 10% of their shares. Companies with a low float will receive a lower weighting on the index. […]
As unlikely it is to happen at scale, as a thought process - what would happen if people start selling those index funds in a mad rush? Just drives the transaction volume because those with that new money will just buy something else in the market?
I know SpaceX, Anthropic, and OpenAI will probably be a drop in the bucket in terms of scale of these funds, (free float % etc). But, is it realistic to take the money out of index funds for a bit until the price of these new stocks come crashing eventually?
If people actually dumped index funds for cash en masse it would be catastrophic. To attach some numbers, MSFT averages about 35M shares in daily volume, and that includes all the market makers, HFTs, etc. BlackRock (iShares) owns 593M shares of MSFT and Vanguard owns another 482M. Together, the amount of shares that index funds own is about a month and a half of total trading volumes. I'd bet that such a crash would unfold over about 2-3 days, which brings up the specter of stocks literally going "no bid", where there are not enough buyers for every seller to sell, at any price.
Likely the government would step in and inject cash directly into the markets to support them in such a scenario, because a broad-index stock market crash is the modern-day bank run. Retirees carry the bulk of their savings in the form of stocks; if it disappears, we'd likely face revolt.
These stocks crashing (not saying it will or won’t happen), means AI is crashing, and that will be a much broader selloff than these 3. Add Microsoft, Micron, Amazon, Oracle, Nvidia, Supermicro, Dell, etc, any company that has direct or indirect exposure to the massive AI boom (and possibly their lenders).
While unlikely to happen at scale, by way of anecdata I'll say that I and my extended family have almost all shifted money away from funds that are heavily coupled to the fate of GenAI.
The bottom is going to fall out of the market and it's going to take years to recover, I don't see any reason to suffer through that (and neither do my retirement-age relatives).
I'm after steady gains in an approximately efficient market, not a wildly unsustainable speculative boondoggle, thanks.
> CRSP indexes were also recently changed to better accommodate fast entry. New IPOs are eligible for CRSP's suite of indexes after five trading days, provided they pass the index's eligibility and investability screens. Previously, these screens included having at least 10% of shares qualifying as freely tradeable (known as float shares outstanding, or FSO). However, in April the methodology changed to allow stocks with either 10% FSO or approximately $3.3 billion in float-adjusted market capitalization to be eligible for index inclusion. The weighting of stocks in CRSP indexes is also based on free float, which should help address the investability challenges associated with thinly traded stocks.
Total market indexes and target date funds will include this and SpaceX on float adjusted basis I believe. The blast radius is much larger than funds that track the NASDAQ directly.
But isn't that what "total market" means? I don't see how if you invest in a total market fund you could declare "except for SpaceX, Anthropic and OpenAI". Why is it so bad for these accounts to be invested in these companies anyway? Seems pretty typical, i bet all kinds of companies are added to total market indexes each year.
Until recently companies that IPOed weren’t immediately added to the major indexes so there was a longer period for price discovery. This year that changed; so you have retirement funds that typically are more conservative acting as exit liquidity for these massive IPOs.
I would have less of an issue if the inclusion in major indexes was delayed 6-12months but we are looking at inclusion within like 5 days for some of these indexes.
>The plan is to rapidly drive these prices up in the first 15 days, get the companies listed in the NASDAQ so funds are forced to purchase them at higher prices, then leave retirement accounts holding the bag.
Dumb question: why couldn't retirement accounts simply not purchase these?
These funds don’t invest actively (picking individual stocks). Instead they invest in indexes that track larger portions of the market. So they’ll automatically buy once the company is listed on the NASDAQ.
Why do I imagine that no one whose retirement account is about to get smoked is in place to make decisions about whether or not this is a good investment
Until the inevitable crash in price when the lockup of employee shares end and they dump their shares onto the market. These fresh companies shouldn’t be included into passive investing securities until 180 days at least. It’s just making the public bag holders.
almost all 401k plans offer funds based on s&p 500, not nasdaq/russell others. s&p has also halved their trading days requirement from 1 yr to 6 months, but that's still sufficient to be past the post-ipo lock-up period.
> Stocks would become eligible for the index after six months rather than 12 months. The requirement to have a minimum Investable Weight Factor of 0.10 (roughly at least 10% of shares publicly floated) would be dropped. Companies would not be required to demonstrate profitability.
> Still, S&P Dow Jones reminds market participants that the proposed changes would apply only to index eligibility. The actual inclusion of new constituents remains entirely at the discretion of the index committee.
This has been a thing in the CRSP indexes (ie. the benchmark for Vanguard’s VTI) forever. As long as it meets float and cap requirements, it’s inserted into the indexes five days after trading begins.
It makes sense. They intend to track the market as it is.
Though, you can definitely make the case that the popularization of index funds has allowed their holders to essentially become patsies to hype IPOs.
Even with the CRSP indexes this was recently changed to make fast-tracking for these IPOs easier.[0]
> CRSP indexes were also recently changed to better accommodate fast entry . . . Previously, these screens included having at least 10% of shares qualifying as freely tradeable (known as float shares outstanding, or FSO). However, in April the methodology changed to allow stocks with either 10% FSO or approximately $3.3 billion in float-adjusted market capitalization to be eligible for index inclusion.
That change is notable because both Anthropic and SpaceX are planning to IPO at well under that old 10% requirement.[1] Neither would have qualified for fast-track inclusion before, but both are virtually guaranteed to clear the absolute valuation bar.
The person I was responding to was speaking to the fast-track concept, which has been a thing in CRSP indexes for a quite a while.
The float requirement changes are directly due to these huge IPOs only placing small amounts of float on the market. Their goal seems to be tracking the market and making this change prevents them from excluding two notable companies from their indexes.
IIRC CRSP indexes are float-weighted so they aren't going to attempt buying a ton of these IPOs anyway due to that low float.
Again. Would I have made the change? No because placing that little float on the market isn't kosher IMO.
These IPOs will have minuscule impact on the indexes initially. They will have a big impact if they can maintain share price in the first ranking/reconstitution after the lockup period expires.
> This has been a thing in the CRSP indexes (ie. the benchmark for Vanguard’s VTI) forever.
CRSP has recently changed their rules:
> CRSP indexes were also recently changed to better accommodate fast entry. New IPOs are eligible for CRSP's suite of indexes after five trading days, provided they pass the index's eligibility and investability screens. Previously, these screens included having at least 10% of shares qualifying as freely tradeable (known as float shares outstanding, or FSO). However, in April the methodology changed to allow stocks with either 10% FSO or approximately $3.3 billion in float-adjusted market capitalization to be eligible for index inclusion. The weighting of stocks in CRSP indexes is also based on free float, which should help address the investability challenges associated with thinly traded stocks.
I get the sentiment that this is unscrupulous, however, isn't 15 days enough time to find the right price? Or will that not really happen until first quarterly earnings report, which will not occur within that 15 day window?
Very true. Anthropic just raised money at the end of last week.
There's no way they could have done that without telling those investors the S-1 was prepared and awaiting their signature on the round before they hit Submit, so to speak.
You can protect yourself, but many won't be aware of the situation until it's too late, and institutionally managed funds won't be able to change their rules in time to avoid holding these as part of the index funds they hold.
Many individuals can, but good luck reaching out and convincing the entire country that they should look into making changes to their retirement fund allocations without sounding like a kook.
There's maybe, at best, 1% of the country even aware that this might be a problem.
I’m not sure I could. Even starting to research how to prevent being affected by these changes shows that there’s layers upon layers of systems that are being manipulated, and there are costs charged for moving the capital in my retirement account to other accounts.
Saying you as in any random person can protect themself from a group of dedicated experts who also have access to levers the common person can’t pull, is kind of not believable on its face.
Anthropic unlike OpenAI has reached an operating profit of 559 million, which is really telling. They've also been migrating enterprise customers to API pricing, which is likely part of why they've become so profitable.
Exactly. Incredibly hard to understand what hard, non-headline-quoting, steel man arguments there are about how exactly the market will hiccup. And as if all of the AI companies somehow know this and are looking to IPO themselves out when anthropic revenue is growing > 10x per year for multiple years. Feels like a massive disconnect between “this will all implode” people and any real numbers.
They need a price consumers can't stomach or are unwilling to pay, and without that the company is profitable but not able to justify investments. That's the argument.
I'm interested in your argument but who needs a price for what exactly? Like token costs are unsustainable argument? Or are you saying they need a stock price to keep their valuation high?
Token cost might be sustainable but still not profitable enough to make up for the costs of either training or the investments gifted away until it became profitable. They also might have no relevant moat that allows them to enshittify enough. But mainly, they are in "I need to kill whole industries to be worth it" tiers of investment.
That is not why you are seeing a deluge in listings. It takes 1-2 years to make a company IPO ready and is a massive operational headache, and the controls needed take multiple quarters to implement.
The reason you are seeing a boom in IPOs versus 2023-25 is because a large portion of funds that are from the 2016-20 vintage are about to hit the 10 year mark when LPs need to be made whole.
This means you need to exit your investments either with an additional round, an acquisition, or (the most common approach for growth equity which is what series D and later rounds are) IPO.
S-1 isn’t public yet. Source on the lockup period? SpaceX for example filed with accelerated release of insider/investor shares so I don’t think we can know if this is the case until the filing documents become public.
Going to give the benefit of the doubt here. I know what lockup period means.
365day lockup isn’t a universal standard. For example for SpaceX 20% of insider shares can be sold in the first few days. 100% within the first 3 months.
Without a public S-1 filing we don’t know what the lockup for Anthropic will be
Look at SpaceXs filing. There is one but it is super short. I was just pointing out that 365day lockup is likely incorrect and OP doesn’t really know that until the filing is approved and becomes public.
I'm sure they can get private loads or similiar way to "hedge" those? also dark markets and other tricks exist. Fin. eng. level goes way higher for them, just contact inv. banker or their lower class friends. They will find a way.
> Are we in a race to see who can pop the bubble first?
Just because it's a bubble doesn't mean money can't be made.
If you're worried it and the risk involved, perhaps go from 100% equities (100/0) to an allocation that has some bonds (90/10, 80/20, etc). Rebalance as things get out of whack.
There are products that do this rebalancing for you: target-date funds that increase bond allocation as you get closer to retirement, or fixed-allocation all-in-one funds (VASGX, VSMGX; CA: VEQT/XEQT).
Having some bonds and rebalancing would have saved US domestic investors in the so-called Lost Decade of the '00s:
As you likely know, rules have recently been changed that basically force many 401k funds to invest in these IPOs while simultaneously having a relatively small number of the initial IPO to be sold to the public forcing the funds to by at inflated prices.
The bubble won't pop until these retirement accounts of have been raided.
I'm pretty sure that's the change GP is referring to. But pension funds can choose to specifically exclude such companies. The Danish pension fund has already excluded SpaceX, which owns xAI. (This also probably relates to American threats of annexation of Danish territories, not just AI stuff.)
And as suspected, the Anthropic deal is not recurring revenue, its just a think they can cancel anytime with 90 days notice...Release the bad news slowly and when people are looking somewhere else...
SpaceX AI segment lost about $2.5B from operations in Q1 2026 on $818M revenue...they are burning dollars. Musk controls about 85% of voting power through supervoting shares, and cannot be fired...go IPO buyers...nothing like economic exposure without control....
If OpenAI and Anthropic eventually become public companies with trillion-dollar valuations, it will be interesting to see if their company ethos remains the same. With that much purchasing power, it's very tempting to gobble up competitors and raise prices.
The real competition is coming out of China right now and I doubt the Chinese government is going to let them buy out their "fast follower" AI companies that are consistently 6-12 months behind in terms of quality. That said, I'm factoring quality as in Opus 4.5/Sonnet 4.5/GPT-5.5 as break points since I haven't really seen an improvement since that point when using AI.
> Compounding the problem, labs in China often release dual-use capable models as open-weight. Once a model is open-weight, safeguards that do exist can be removed, making the model available to any state or non-state actor to use for malicious purposes, including the cyber and CBRN misuse those safeguards were built to prevent.
Probably but the reality is I doubt that actually works outside of US government contracts in practice simply because Europe/et al aren't going to follow their lead.
Europe has been slowly committing economic suicide for the last 30 years by outsourcing everything to the US and China (and Russia), and it looks like maybe Europeans are finally starting to wake up to this.
I wouldn't be one bit surprised if a rash of digital sovereignty movements in the near future hamper Chinese model adoption.
You speak so authoritatively about quality and performance of these models, yet there are no quantitative metrics that correlate to real world outcomes that indicate that the quality and performance of these models is anything but subjective noise and classic benchmark nonsense.
A company consumed half a billion dollars worth of tokens in a month and nobody noticed anything until the bill came due.
Tha $500m dollars is roughly equivalent to 2000 people working for a year or 500 people working for four years, they can and would accomplish a lot if they worked in companies that add value to the economy by solving real problems.
Indeed Its irrelevant. Each firm will make its own cost-benefit analysis, especially since the frontier labs are raising prices.
Marketing only takes you so far in creating noise.
Its weird seeing this focus on bench marks again - PC's did this for quite some time. But in the end it came down to - what does all this additional horsepower let you do? Oh create interesting apps, multi-tasking etc. Which was really the value-add.
> You speak so authoritatively about quality and performance of these models, yet there are no quantitative metrics that correlate to real world outcomes that indicate that the quality and performance of these models is anything but subjective noise and classic benchmark nonsense.
I'm responsible for AI roll out at a small business and we've had data science go over these things internally in terms of what results we get for 12+ months now. Its just my experience that is roughly the results we've seen using Deepseek, etc. and comparing cost/results vs. Anthropic/ChatGPT.
> A company consumed half a billion dollars worth of tokens in a month and nobody noticed anything until the bill came due.
It was sourced from one anonymous source. Its highly unlikely to be true in my view, but hey, you do you.
I’m curious which will start producing hardware be it robotics, consumer or commercial devices, chips, energy infrastructure or transforming shipping crates into housing for jobless humans. Maybe even tanks of gel with arrays of humans in suspended animation reading our biometrics, thoughts, pumping in nutrients and training on the data. O_o
Who else right now is making competing models that are roughly as capable? Now factor in hardware availability / future delivery contracts and capital requirements for building datacenters and running new training. If you're trying to compete and lease all that with VC money or loans, good luck actually competing.
I think this IPO will be the real test of whether the concept of a Public Benefit Corporation actually holds up in practice. Don't mess this up, Anthropic.
Is it actually refreshing? It's actually refreshing to see Stripe staying private for so long. That means, they have a sustainable business model, and can take on projects that might benefit users in the long term despite negative short term consequences instead of focus on growing at all cost for the most part.
Becoming public allows everyday people to access the wealth generation machine your created.
Sometimes I think that the endless cynicism around corporations that exists online is the real ploy by capitalists to keep people poor. It seems to be pretty damn effective at making people allergic to claiming their slice of the pie.
"Going public" means something completely different now, especially for these companies in the news (Anthropic, OpenAI, SpaceX, etc).
Going public used to mean selling a portion of your company for the capital required to grow. Ideally John Q. Public buys stock, the company grows, and they can sell the stock for more money.
These companies already have the capital required to grow from private investment, and already grew; they're behemoths. The act of "going public" are those private investors using the public market to cash out their investment. The exponential growth the public buyers are expecting to see has most likely already happened.
Stripe seems to be doing fairly well as a private company. They continually offer liquidity events for employees to cash out, while also retaining less pressure for hypergrowth from outside activists and investors.
It's the contents of the submission that are confidential, not the fact that they are submitting.
The contents themselves contain a lot of detailed information about the internals of the company including financials, revenue, ownership details etc... those details are what's confidential until the SEC gives its approval, at which point the public can then review the document.
> We study long-run shareholder outcomes for over 64,000 global common stocks during the January 1990 to December 2020 period. We document that the majority, 55.2% of U.S. stocks and 57.4% of non-U.S. stocks, underperform one-month U.S. Treasury bills in terms of compound returns over the full sample. Focusing on aggregate shareholder outcomes, we find that the top-performing 2.4% of firms account for all of the $US 75.7 trillion in net global stock market wealth creation from 1990 to December 2020. Outside the US, 1.41% of firms account for the $US 30.7 trillion in net wealth creation.
> Four out of every seven common stocks that have appeared in the CRSP database since 1926 have lifetime buy-and-hold returns less than one-month Treasuries. When stated in terms of lifetime dollar wealth creation, the best-performing four percent of listed companies explain the net gain for the entire U.S. stock market since 1926, as other stocks collectively matched Treasury bills. These results highlight the important role of positive skewness in the distribution of individual stock returns, attributable both to skewness in monthly returns and to the effects of compounding. The results help to explain why poorly-diversified active strategies most often underperform market averages.
Further, over ten years, most individual stocks under perform a market index (even more so if stock was initially a top performer):
> […] Since 1926, the median ten-year return on individual U.S. stocks relative to the broad equity market is –7.9%, underperforming by 0.82% per year. For stocks that have been among the top 20% performers over the previous five years, the median ten-year market-adjusted return falls to –17.8%, underperforming by 1.94% per year. Since the end of World War II, the median ten-year market-adjusted return of recent winners has been negative for 93% of the time. The case for diversifying concentrated positions in individual stocks, particularly in recent market winners, is even stronger than most investors realize.
“Passive investing” is not the same as “buying anything at any price”. Index funds follow transparent rules and weights. If the company is overvalued, that overvaluation is set by the wider market, not just passive investors.
I've heard of the changes to the NASDAQ rules and I somewhat get how they make it so these stocks are included in index funds earlier than before. As far as I know, NYSE and others haven't done the same change so index funds there are "safe", i.e. will include the stocks only after a longer period, implying that it will have settled in value by then. Is that true at all? I'm sure the situation is much more complicated, but I do wonder how to figure out how much I'm affected.
There is a huge amount of misinformation on this topic, including in this thread, at the minute.
Some index funds have a very long horizon before they include them (e.g. a year). Others are "fast-tracked" (e.g. notably VTI). Most of those, however, are float-adjusted, so only the stock available for trade is considered part of the marketcap. So e.g. VTI / VTSAX will buy spacex relatively quickly after the IPO but at the float-adjusted weight of ~$75B because that's the % of stock available.
If you care alot about this, now is the time to understand how your index fund treats IPOs wrt to delays + float adjustment.
Specifically, I do a typical 3FP and own VTSAX, but I don't read bogleheads or anything. True set-it-and-forget-it, but I do want to read more if things are shifting.
You should not trust me, but here's my understanding. I wish there was a really good writeup somewhere to explain this authoritatively but I'm not sure there is one. Would also love to see one. Frankly vanguard should do it.
VTSAX (and VTI) follow the CRSP index. This is float-adjusted but they likely will be fast tracked (these are two separate rules in how this index chooses to weight things and participate in new stocks). At ~5% float, these companies will be in the 50-100B range. So under all those assumptions, they'll be bought quickly but represent less than 1% of VTSAX (until they float more shares on the public market).
why did they raise 3 days ago? What's the benefit of doing this instead of going public right away? If it's just cash to pay for GPUs, can't they issue bonds or something?
You pretty much always do a late-stage private round shortly before an IPO, that is the standard. The goal of the late-stage funding round is to give a better idea of how much capital can be raised by the IPO. It helps reduce uncertainty about expectations of what the company is worth before going public.
IPO isn't really about "raising money for the company" any longer, unless one means raising the money in their wallets so they can take the money and run.
With SpaceX, OpenAI, and Anthropic, we're likely to see 3 of the largest IPOs ever (by a wide margin) this year. Will existing institutional investors trim other positions to allocate a lot of capital for these mega listings or is this not a concern?
Most likely. Funds generally don't have much unallocated cash, they operate fully invested, so three huge IPOs will force an asset rebalancing which can cause some liquidity drain from the rest of the market.
Plus as insider lockup periods expire, that's a ton of dollars pulled out of the market and into safer assets. It's going to be a huge net exit of capital.
I'd expect a lot of volatility and pretty heavy downward pressure across the rest of tech.
They are scared of underperfoming the market and failing to exist as an index. Losing money with everyone else is a more sustainable risk than losing money while other indexes go up.
Maybe. If you read the fine print they are not. They have the goal of matching the index returns, but they never say anywhere they have exactly the stocks in the index.
Index funds all make active choices and often hold companies not in the original index. They are more passive than a traditional funds that buys and sells all the time, but they still make active choices. When an index changes stocks they can look up the price - but the funds mirroring the index need to make real trades that if not carefully done will change the value of the stocks (and cause the fund to under perform the index), so index funds have plans to prevent this. Compared to a traditional fund an index fund looks passive and there is much much less for the manager to do - but that doesn't mean the managers do nothing.
Not true for Vanguard's total US stock market fund (VTSAX/VTI), the largest total US stock market fund in the world. Their CRSP index only requires 20 trading days post IPO, or 5 for large caps (this has been true for many years, this is not a recent change)
But only the amount the company floats for many index funds. So in the case of SpaceX, they are only floating 5% of the company. So the number of shares something like VTI has to buy is much smaller than the total market cap (5% of it).
Reading these messages is getting me discussed. Is there any fund/index fund that is not breaking the rules to allow easier pump and dump from big players?
It means that Anthropic has submitted a document that it intends to share with the public in order to solicit public investment. This document includes details about its business, financials/revenue, ownership structure, risks, etc...
The document itself is what's confidential until the SEC approves it, at which point Anthropic will release that document to the public and IPO.
Of course that fundraise was the last one: [0], everyone getting ready to dump their pre-IPO shares on to you as China catches up with their open models.
Better to do it now than to wait a day longer and the tokens are not getting any cheaper here.
Obviously OpenAI will file for IPO certainly this month, or even this week in response both SpaceX, and Anthropic.
post your position for all to see if you're so confident. Time in market is way better than timing the market. I'd rather ride through a downturn, buying at the same pace i always do, and come out the other side than try to time it. Been there done that and i got burned every time.
This is actually the pin everyone was looking for that will pop this AI bubble, including the token cost falling in China and the release of open models that are good and run locally.
It could be, but the market could bounce right back. And if it does, it's hard to know who will emerge stronger. Anthropic could end up like Amazon, or it could end up like Yahoo.
Every post anthropic generates feels like misdirection and bad summarization using AI. There is no sense of who the audience for this post is for and includes a lot of redundant information.
Can't see the relevance of this comment to the post. You can do a Google search for "confidentially submits draft S-1 to the SEC" to see other examples of companies announcing these submissions and they're all written in the same way.
It's just a standard/template that most companies reuse.
Is there any real reason to have generated announcements anyway? You could get more polished text with some copy editors and I can't imagine cost is really a big concern for it.
There is a mad rush to get these IPOs out the door before the market sneezes.
It's more insidious than that. These IPOs aren't being rushed, they were waiting for all the pieces to be in place to force 401ks and other retirement plans to buy these IPOs.
The most recent change was the NASDAQ adopting the "fast change rule" which allows newly IPO'd companies to be listed in the index after only 15 days of trading. This rule was decided March 30, 2026 and only came into effect May 1, 2026.
The plan is to rapidly drive these prices up in the first 15 days, get the companies listed in the NASDAQ so funds are forced to purchase them at higher prices, then leave retirement accounts holding the bag.
> The most recent change was the NASDAQ adopting the "fast change rule" which allows newly IPO'd companies to be listed in the index after only 15 days of trading.
Official justification, and other changes besides timeframe, e.g.:
> First, eligibility and company size. As multi‑class share structures have become more common, we now consider both listed and unlisted shares when determining eligibility and ranking. This allows the index to reflect a company's full economic size, while index weighting remains based solely on listed shares. This change affects who qualifies for inclusion, not how constituents are weighted.
* https://www.nasdaq.com/newsroom/nasdaq100-index-methodology-...
> A new method to calculate the market capitalization of companies to determine their eligibility for inclusion in the index. It involves adding listed stock and unlisted shares that are part of different share classes. Scrapping a rule that requires companies to float a minimum 10% of their shares. Companies with a low float will receive a lower weighting on the index. […]
* https://www.reuters.com/business/new-nasdaq-rules-include-fa...
As unlikely it is to happen at scale, as a thought process - what would happen if people start selling those index funds in a mad rush? Just drives the transaction volume because those with that new money will just buy something else in the market?
I know SpaceX, Anthropic, and OpenAI will probably be a drop in the bucket in terms of scale of these funds, (free float % etc). But, is it realistic to take the money out of index funds for a bit until the price of these new stocks come crashing eventually?
If people actually dumped index funds for cash en masse it would be catastrophic. To attach some numbers, MSFT averages about 35M shares in daily volume, and that includes all the market makers, HFTs, etc. BlackRock (iShares) owns 593M shares of MSFT and Vanguard owns another 482M. Together, the amount of shares that index funds own is about a month and a half of total trading volumes. I'd bet that such a crash would unfold over about 2-3 days, which brings up the specter of stocks literally going "no bid", where there are not enough buyers for every seller to sell, at any price.
Likely the government would step in and inject cash directly into the markets to support them in such a scenario, because a broad-index stock market crash is the modern-day bank run. Retirees carry the bulk of their savings in the form of stocks; if it disappears, we'd likely face revolt.
These stocks crashing (not saying it will or won’t happen), means AI is crashing, and that will be a much broader selloff than these 3. Add Microsoft, Micron, Amazon, Oracle, Nvidia, Supermicro, Dell, etc, any company that has direct or indirect exposure to the massive AI boom (and possibly their lenders).
Just look at Corning’s lifetime chart
While unlikely to happen at scale, by way of anecdata I'll say that I and my extended family have almost all shifted money away from funds that are heavily coupled to the fate of GenAI.
The bottom is going to fall out of the market and it's going to take years to recover, I don't see any reason to suffer through that (and neither do my retirement-age relatives).
I'm after steady gains in an approximately efficient market, not a wildly unsustainable speculative boondoggle, thanks.
If the bottom is falling out of the market in AI I think it's likely other things will fall too though.
What’s your portfolio? I don’t particularly have a wealth of investment options in my employer-provided 401k (ADP Workforce Now)
example of a steady gain in an approximately efficient market if Big Tech crashes?
Very few 401ks offer the NASDAQ 100 as an investment option. Last I checked it was <1%.
Apparently the rule change also affects CRSP, which is the index behind Vanguard's Total Stock Market (VTI) index funds.
https://finance.yahoo.com/markets/stocks/articles/spacex-ipo...
VTI in turn is the primary holding of most of Vanguard's Target Date retirement funds, which are widely held in 401ks.
Recent changes:
> CRSP indexes were also recently changed to better accommodate fast entry. New IPOs are eligible for CRSP's suite of indexes after five trading days, provided they pass the index's eligibility and investability screens. Previously, these screens included having at least 10% of shares qualifying as freely tradeable (known as float shares outstanding, or FSO). However, in April the methodology changed to allow stocks with either 10% FSO or approximately $3.3 billion in float-adjusted market capitalization to be eligible for index inclusion. The weighting of stocks in CRSP indexes is also based on free float, which should help address the investability challenges associated with thinly traded stocks.
* https://www.schwab.com/learn/story/some-indexes-accelerate-e...
NASDAQ index has a 3x float weighting (and a far, far smaller total capitalization) which makes it far more susceptible.
Other indexes do not have these multipliers, and are much larger. The exposure for e.g. VTI is far, far less.
Total market indexes and target date funds will include this and SpaceX on float adjusted basis I believe. The blast radius is much larger than funds that track the NASDAQ directly.
But isn't that what "total market" means? I don't see how if you invest in a total market fund you could declare "except for SpaceX, Anthropic and OpenAI". Why is it so bad for these accounts to be invested in these companies anyway? Seems pretty typical, i bet all kinds of companies are added to total market indexes each year.
Until recently companies that IPOed weren’t immediately added to the major indexes so there was a longer period for price discovery. This year that changed; so you have retirement funds that typically are more conservative acting as exit liquidity for these massive IPOs.
I would have less of an issue if the inclusion in major indexes was delayed 6-12months but we are looking at inclusion within like 5 days for some of these indexes.
No but your funds are backed by ones that are
>The plan is to rapidly drive these prices up in the first 15 days, get the companies listed in the NASDAQ so funds are forced to purchase them at higher prices, then leave retirement accounts holding the bag.
Dumb question: why couldn't retirement accounts simply not purchase these?
These funds don’t invest actively (picking individual stocks). Instead they invest in indexes that track larger portions of the market. So they’ll automatically buy once the company is listed on the NASDAQ.
Why do I imagine that no one whose retirement account is about to get smoked is in place to make decisions about whether or not this is a good investment
Seems like there should be a market for a no-Elon/OpenAI/Anthropic ETF out there.
Or one that just imposes a reasonable waiting period on adding newly-IPO’d listings.
It is not going to take 15 days for short selling hedge funds to right-price these IPOs. It is going to take something closer to a few seconds.
Until the inevitable crash in price when the lockup of employee shares end and they dump their shares onto the market. These fresh companies shouldn’t be included into passive investing securities until 180 days at least. It’s just making the public bag holders.
almost all 401k plans offer funds based on s&p 500, not nasdaq/russell others. s&p has also halved their trading days requirement from 1 yr to 6 months, but that's still sufficient to be past the post-ipo lock-up period.
I don't think the S&P has actually made a decision yet. It is in progress, though: "The S&P Index Consultation on MegaCap IPOs" is the search term
What is being considered by S&P:
> Stocks would become eligible for the index after six months rather than 12 months. The requirement to have a minimum Investable Weight Factor of 0.10 (roughly at least 10% of shares publicly floated) would be dropped. Companies would not be required to demonstrate profitability.
* https://www.schwab.com/learn/story/some-indexes-accelerate-e...
Though:
> Still, S&P Dow Jones reminds market participants that the proposed changes would apply only to index eligibility. The actual inclusion of new constituents remains entirely at the discretion of the index committee.
This has been a thing in the CRSP indexes (ie. the benchmark for Vanguard’s VTI) forever. As long as it meets float and cap requirements, it’s inserted into the indexes five days after trading begins.
It makes sense. They intend to track the market as it is.
Though, you can definitely make the case that the popularization of index funds has allowed their holders to essentially become patsies to hype IPOs.
> As long as it meets float and cap requirements
Even with the CRSP indexes this was recently changed to make fast-tracking for these IPOs easier.[0]
> CRSP indexes were also recently changed to better accommodate fast entry . . . Previously, these screens included having at least 10% of shares qualifying as freely tradeable (known as float shares outstanding, or FSO). However, in April the methodology changed to allow stocks with either 10% FSO or approximately $3.3 billion in float-adjusted market capitalization to be eligible for index inclusion.
That change is notable because both Anthropic and SpaceX are planning to IPO at well under that old 10% requirement.[1] Neither would have qualified for fast-track inclusion before, but both are virtually guaranteed to clear the absolute valuation bar.
[0]https://www.schwab.com/learn/story/some-indexes-accelerate-e...
[1]https://www.economist.com/finance-and-economics/2026/06/01/c...
The person I was responding to was speaking to the fast-track concept, which has been a thing in CRSP indexes for a quite a while.
The float requirement changes are directly due to these huge IPOs only placing small amounts of float on the market. Their goal seems to be tracking the market and making this change prevents them from excluding two notable companies from their indexes.
IIRC CRSP indexes are float-weighted so they aren't going to attempt buying a ton of these IPOs anyway due to that low float.
Again. Would I have made the change? No because placing that little float on the market isn't kosher IMO.
Strongly recommend reading this linked paper, written by CRSP folks:
https://indexes.morningstar.com/insights/analysis/bltcd8e699...
These IPOs will have minuscule impact on the indexes initially. They will have a big impact if they can maintain share price in the first ranking/reconstitution after the lockup period expires.
> This has been a thing in the CRSP indexes (ie. the benchmark for Vanguard’s VTI) forever.
CRSP has recently changed their rules:
> CRSP indexes were also recently changed to better accommodate fast entry. New IPOs are eligible for CRSP's suite of indexes after five trading days, provided they pass the index's eligibility and investability screens. Previously, these screens included having at least 10% of shares qualifying as freely tradeable (known as float shares outstanding, or FSO). However, in April the methodology changed to allow stocks with either 10% FSO or approximately $3.3 billion in float-adjusted market capitalization to be eligible for index inclusion. The weighting of stocks in CRSP indexes is also based on free float, which should help address the investability challenges associated with thinly traded stocks.
* https://www.schwab.com/learn/story/some-indexes-accelerate-e...
I get the sentiment that this is unscrupulous, however, isn't 15 days enough time to find the right price? Or will that not really happen until first quarterly earnings report, which will not occur within that 15 day window?
The fact that you know there’s a large pool of price insensitive buyers only 15 days away has to have some price impact.
No, IPO pops, and honey moon periods are common.
And there are plenty of ways to manipulate the price, such as issuing a low float to a hyper hyped stock..
I mean the goal is that you have multiple earnings report to show sustainability.
Meanwhile some of these companies are also lobbying to be able to only have to submit annual or biannual earnings reports, too.
Everyone is looking for multiple ways to leave the dumb money holding the bag.
How do these people sleep at night coming up with schemes like that?
On a big pile of money surrounded by beautiful women.
They don't. They work all night to invent them.
Very true. Anthropic just raised money at the end of last week.
There's no way they could have done that without telling those investors the S-1 was prepared and awaiting their signature on the round before they hit Submit, so to speak.
If you believe this is going to happen you can change the allocations of your retirement plans.
You can protect yourself, but many won't be aware of the situation until it's too late, and institutionally managed funds won't be able to change their rules in time to avoid holding these as part of the index funds they hold.
Many individuals can, but good luck reaching out and convincing the entire country that they should look into making changes to their retirement fund allocations without sounding like a kook.
There's maybe, at best, 1% of the country even aware that this might be a problem.
What should we be looking for?
I’m not sure I could. Even starting to research how to prevent being affected by these changes shows that there’s layers upon layers of systems that are being manipulated, and there are costs charged for moving the capital in my retirement account to other accounts.
Saying you as in any random person can protect themself from a group of dedicated experts who also have access to levers the common person can’t pull, is kind of not believable on its face.
Anthropic unlike OpenAI has reached an operating profit of 559 million, which is really telling. They've also been migrating enterprise customers to API pricing, which is likely part of why they've become so profitable.
what is going to cause the market to “sneeze”?
Exactly. Incredibly hard to understand what hard, non-headline-quoting, steel man arguments there are about how exactly the market will hiccup. And as if all of the AI companies somehow know this and are looking to IPO themselves out when anthropic revenue is growing > 10x per year for multiple years. Feels like a massive disconnect between “this will all implode” people and any real numbers.
They need a price consumers can't stomach or are unwilling to pay, and without that the company is profitable but not able to justify investments. That's the argument.
I'm interested in your argument but who needs a price for what exactly? Like token costs are unsustainable argument? Or are you saying they need a stock price to keep their valuation high?
Token cost might be sustainable but still not profitable enough to make up for the costs of either training or the investments gifted away until it became profitable. They also might have no relevant moat that allows them to enshittify enough. But mainly, they are in "I need to kill whole industries to be worth it" tiers of investment.
They say it’s going to happen because they want it to happen.
And oh boy do they make sure everyone knows that they are doing an IPO
Confidently, even. Which uh... if I've learned anything about PR speak, sentences generally mean the opposite of what they say.
That is not why you are seeing a deluge in listings. It takes 1-2 years to make a company IPO ready and is a massive operational headache, and the controls needed take multiple quarters to implement.
The reason you are seeing a boom in IPOs versus 2023-25 is because a large portion of funds that are from the 2016-20 vintage are about to hit the 10 year mark when LPs need to be made whole.
This means you need to exit your investments either with an additional round, an acquisition, or (the most common approach for growth equity which is what series D and later rounds are) IPO.
SpaceX submitted an amendment to their S-1 today[1]
[1]: https://www.sec.gov/Archives/edgar/data/1181412/000162828026...
Are we in a race to see who can pop the bubble first?
They all know it’s coming, if it pops before they ipo then they don’t get their billion dollar payday, they have every incentive to move quickly.
FYI they have about a 365 day lockup after IPO before the execs can sell.
They get to sell 20% on day two. Get f’ed everyone!
https://www.fool.com/investing/2026/05/29/spacexs-massive-ip...
S-1 isn’t public yet. Source on the lockup period? SpaceX for example filed with accelerated release of insider/investor shares so I don’t think we can know if this is the case until the filing documents become public.
Common knowledge: https://en.wikipedia.org/wiki/Lock-up_period
Going to give the benefit of the doubt here. I know what lockup period means.
365day lockup isn’t a universal standard. For example for SpaceX 20% of insider shares can be sold in the first few days. 100% within the first 3 months.
Without a public S-1 filing we don’t know what the lockup for Anthropic will be
sure but it would be really weird if there wasn't one
Look at SpaceXs filing. There is one but it is super short. I was just pointing out that 365day lockup is likely incorrect and OP doesn’t really know that until the filing is approved and becomes public.
I'm sure they can get private loads or similiar way to "hedge" those? also dark markets and other tricks exist. Fin. eng. level goes way higher for them, just contact inv. banker or their lower class friends. They will find a way.
It cant be that simple, I am sure that they will find some way to make money before that
> Are we in a race to see who can pop the bubble first?
Just because it's a bubble doesn't mean money can't be made.
If you're worried it and the risk involved, perhaps go from 100% equities (100/0) to an allocation that has some bonds (90/10, 80/20, etc). Rebalance as things get out of whack.
There are products that do this rebalancing for you: target-date funds that increase bond allocation as you get closer to retirement, or fixed-allocation all-in-one funds (VASGX, VSMGX; CA: VEQT/XEQT).
Having some bonds and rebalancing would have saved US domestic investors in the so-called Lost Decade of the '00s:
* https://www.forbes.com/sites/advisor/2010/09/13/its-not-real...
As you likely know, rules have recently been changed that basically force many 401k funds to invest in these IPOs while simultaneously having a relatively small number of the initial IPO to be sold to the public forcing the funds to by at inflated prices.
The bubble won't pop until these retirement accounts of have been raided.
What are the 401k rule changes? I am aware that indexes changed their rules
I'm pretty sure that's the change GP is referring to. But pension funds can choose to specifically exclude such companies. The Danish pension fund has already excluded SpaceX, which owns xAI. (This also probably relates to American threats of annexation of Danish territories, not just AI stuff.)
And as suspected, the Anthropic deal is not recurring revenue, its just a think they can cancel anytime with 90 days notice...Release the bad news slowly and when people are looking somewhere else...
SpaceX AI segment lost about $2.5B from operations in Q1 2026 on $818M revenue...they are burning dollars. Musk controls about 85% of voting power through supervoting shares, and cannot be fired...go IPO buyers...nothing like economic exposure without control....
What changed?
If OpenAI and Anthropic eventually become public companies with trillion-dollar valuations, it will be interesting to see if their company ethos remains the same. With that much purchasing power, it's very tempting to gobble up competitors and raise prices.
They already do both.
The real competition is coming out of China right now and I doubt the Chinese government is going to let them buy out their "fast follower" AI companies that are consistently 6-12 months behind in terms of quality. That said, I'm factoring quality as in Opus 4.5/Sonnet 4.5/GPT-5.5 as break points since I haven't really seen an improvement since that point when using AI.
They'll just lobby to ban Chinese models as they're already doing.
> Compounding the problem, labs in China often release dual-use capable models as open-weight. Once a model is open-weight, safeguards that do exist can be removed, making the model available to any state or non-state actor to use for malicious purposes, including the cyber and CBRN misuse those safeguards were built to prevent.
https://www.anthropic.com/research/2028-ai-leadership
They are already starting that now.
Probably but the reality is I doubt that actually works outside of US government contracts in practice simply because Europe/et al aren't going to follow their lead.
Europe has been slowly committing economic suicide for the last 30 years by outsourcing everything to the US and China (and Russia), and it looks like maybe Europeans are finally starting to wake up to this.
I wouldn't be one bit surprised if a rash of digital sovereignty movements in the near future hamper Chinese model adoption.
You speak so authoritatively about quality and performance of these models, yet there are no quantitative metrics that correlate to real world outcomes that indicate that the quality and performance of these models is anything but subjective noise and classic benchmark nonsense.
A company consumed half a billion dollars worth of tokens in a month and nobody noticed anything until the bill came due.
Tha $500m dollars is roughly equivalent to 2000 people working for a year or 500 people working for four years, they can and would accomplish a lot if they worked in companies that add value to the economy by solving real problems.
Indeed Its irrelevant. Each firm will make its own cost-benefit analysis, especially since the frontier labs are raising prices.
Marketing only takes you so far in creating noise.
Its weird seeing this focus on bench marks again - PC's did this for quite some time. But in the end it came down to - what does all this additional horsepower let you do? Oh create interesting apps, multi-tasking etc. Which was really the value-add.
> You speak so authoritatively about quality and performance of these models, yet there are no quantitative metrics that correlate to real world outcomes that indicate that the quality and performance of these models is anything but subjective noise and classic benchmark nonsense.
I'm responsible for AI roll out at a small business and we've had data science go over these things internally in terms of what results we get for 12+ months now. Its just my experience that is roughly the results we've seen using Deepseek, etc. and comparing cost/results vs. Anthropic/ChatGPT.
> A company consumed half a billion dollars worth of tokens in a month and nobody noticed anything until the bill came due.
It was sourced from one anonymous source. Its highly unlikely to be true in my view, but hey, you do you.
The question is not "if" they will lose their ethos but "how long will it take".
If "Open AI" was their ethos, it was lost immediately. I'm not sure what the ethos of Anthropic is.
I gather most of the ethos behind Anthropic is "we don't want to work with Sam".
Go public so everybody can benefit?
corporate pursuit of monopoly is as sure a phenomenon as gravity
I’m curious which will start producing hardware be it robotics, consumer or commercial devices, chips, energy infrastructure or transforming shipping crates into housing for jobless humans. Maybe even tanks of gel with arrays of humans in suspended animation reading our biometrics, thoughts, pumping in nutrients and training on the data. O_o
IPO won't lose their ethos. Competition out from their duopoly will.
Who else right now is making competing models that are roughly as capable? Now factor in hardware availability / future delivery contracts and capital requirements for building datacenters and running new training. If you're trying to compete and lease all that with VC money or loans, good luck actually competing.
> if their company ethos remains the same.
What? In what way would the change? They are already raising prices..
There is significant first-mover advantage for torching your ethos.
what is their company ethos? They are some of the most despicable tech companies in my opinion.
I think this IPO will be the real test of whether the concept of a Public Benefit Corporation actually holds up in practice. Don't mess this up, Anthropic.
After years of companies refusing to go public (looking at you Stripe), it's almost refreshing to see a hyped tech go actually IPO.
Is it actually refreshing? It's actually refreshing to see Stripe staying private for so long. That means, they have a sustainable business model, and can take on projects that might benefit users in the long term despite negative short term consequences instead of focus on growing at all cost for the most part.
Sustainable business models that need insano numbers of funding rounds?
We don’t actually know if their business model is sustainable. If they were public we would have a better answer to this.
Becoming public allows everyday people to access the wealth generation machine your created.
Sometimes I think that the endless cynicism around corporations that exists online is the real ploy by capitalists to keep people poor. It seems to be pretty damn effective at making people allergic to claiming their slice of the pie.
"Going public" means something completely different now, especially for these companies in the news (Anthropic, OpenAI, SpaceX, etc).
Going public used to mean selling a portion of your company for the capital required to grow. Ideally John Q. Public buys stock, the company grows, and they can sell the stock for more money.
These companies already have the capital required to grow from private investment, and already grew; they're behemoths. The act of "going public" are those private investors using the public market to cash out their investment. The exponential growth the public buyers are expecting to see has most likely already happened.
Stripe seems to be doing fairly well as a private company. They continually offer liquidity events for employees to cash out, while also retaining less pressure for hypergrowth from outside activists and investors.
Companies rush to IPO because they think the price they are selling at is so high that it outweighs the painful nature of being a public company.
This is the first time I've seen a Public, Confidential S-1 filing.
It's the contents of the submission that are confidential, not the fact that they are submitting.
The contents themselves contain a lot of detailed information about the internals of the company including financials, revenue, ownership details etc... those details are what's confidential until the SEC gives its approval, at which point the public can then review the document.
What this means it that it won't survive scrutiny, so better hide it so that there is only a small amount of time to do it.
Why do you think this? Confidential filings before an IPO are standard practice.
I suppose they announced it because the fact that they submitted it would leak anyway.
I like your sense of humor
That's how you know it's purely marketing and they're not actually going public.
excuse me. what am i being sold, in this so called marketing?
You? Nothing. Private investors? The dream of an IPO.
they closed series h, last thursday†. what are you on about?
† https://www.anthropic.com/news/series-h
Given how often these get leaked (see Palantir + SpaceX) and the cost of preparation, why would you ever file an S-1 unless you were serious?
Because you want another funding round but you will get it only if investors think they're going to get their money back soon.
Where will it be listed? I am considering selling all my index ETFs in those markets until the this blows over.
Time in market > timing the market.
It's this sort of mentality and the prolitferation of passive investing that gives these companies the opportunity to pass the bag.
> It's this sort of mentality and the prolitferation of passive investing that gives these companies the opportunity to pass the bag.
As opposed to normal people trying to pick winning stocks?
* https://en.wikipedia.org/wiki/A_Random_Walk_Down_Wall_Street
Most stocks suck:
> We study long-run shareholder outcomes for over 64,000 global common stocks during the January 1990 to December 2020 period. We document that the majority, 55.2% of U.S. stocks and 57.4% of non-U.S. stocks, underperform one-month U.S. Treasury bills in terms of compound returns over the full sample. Focusing on aggregate shareholder outcomes, we find that the top-performing 2.4% of firms account for all of the $US 75.7 trillion in net global stock market wealth creation from 1990 to December 2020. Outside the US, 1.41% of firms account for the $US 30.7 trillion in net wealth creation.
* https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3710251
> Four out of every seven common stocks that have appeared in the CRSP database since 1926 have lifetime buy-and-hold returns less than one-month Treasuries. When stated in terms of lifetime dollar wealth creation, the best-performing four percent of listed companies explain the net gain for the entire U.S. stock market since 1926, as other stocks collectively matched Treasury bills. These results highlight the important role of positive skewness in the distribution of individual stock returns, attributable both to skewness in monthly returns and to the effects of compounding. The results help to explain why poorly-diversified active strategies most often underperform market averages.
* https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2900447
Further, over ten years, most individual stocks under perform a market index (even more so if stock was initially a top performer):
> […] Since 1926, the median ten-year return on individual U.S. stocks relative to the broad equity market is –7.9%, underperforming by 0.82% per year. For stocks that have been among the top 20% performers over the previous five years, the median ten-year market-adjusted return falls to –17.8%, underperforming by 1.94% per year. Since the end of World War II, the median ten-year market-adjusted return of recent winners has been negative for 93% of the time. The case for diversifying concentrated positions in individual stocks, particularly in recent market winners, is even stronger than most investors realize.
* https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4541122
Even with all these shenanigans, most people are better off sticking with index funds.
“Passive investing” is not the same as “buying anything at any price”. Index funds follow transparent rules and weights. If the company is overvalued, that overvaluation is set by the wider market, not just passive investors.
> If the company is overvalued, that overvaluation is set by the wider market, not just passive investors.
You probably also believe the markets are fully efficient and there is no insider trading ever.
Historically, it takes 6-12 months for the wider public market to determine the correct valuation.
That's why SpaceX, Anthropic, OpenAI are rushing to 15 days.
They know something bad will happen between 15 days and 6 months after IPO.
I've heard of the changes to the NASDAQ rules and I somewhat get how they make it so these stocks are included in index funds earlier than before. As far as I know, NYSE and others haven't done the same change so index funds there are "safe", i.e. will include the stocks only after a longer period, implying that it will have settled in value by then. Is that true at all? I'm sure the situation is much more complicated, but I do wonder how to figure out how much I'm affected.
There is a huge amount of misinformation on this topic, including in this thread, at the minute.
Some index funds have a very long horizon before they include them (e.g. a year). Others are "fast-tracked" (e.g. notably VTI). Most of those, however, are float-adjusted, so only the stock available for trade is considered part of the marketcap. So e.g. VTI / VTSAX will buy spacex relatively quickly after the IPO but at the float-adjusted weight of ~$75B because that's the % of stock available.
If you care alot about this, now is the time to understand how your index fund treats IPOs wrt to delays + float adjustment.
Do you have any suggested reading references?
Specifically, I do a typical 3FP and own VTSAX, but I don't read bogleheads or anything. True set-it-and-forget-it, but I do want to read more if things are shifting.
You should not trust me, but here's my understanding. I wish there was a really good writeup somewhere to explain this authoritatively but I'm not sure there is one. Would also love to see one. Frankly vanguard should do it.
VTSAX (and VTI) follow the CRSP index. This is float-adjusted but they likely will be fast tracked (these are two separate rules in how this index chooses to weight things and participate in new stocks). At ~5% float, these companies will be in the 50-100B range. So under all those assumptions, they'll be bought quickly but represent less than 1% of VTSAX (until they float more shares on the public market).
why did they raise 3 days ago? What's the benefit of doing this instead of going public right away? If it's just cash to pay for GPUs, can't they issue bonds or something?
You pretty much always do a late-stage private round shortly before an IPO, that is the standard. The goal of the late-stage funding round is to give a better idea of how much capital can be raised by the IPO. It helps reduce uncertainty about expectations of what the company is worth before going public.
Pump up the valuation baby.
Price setting.
IPO isn't really about "raising money for the company" any longer, unless one means raising the money in their wallets so they can take the money and run.
Right in time to get rich and externalize any fallout.
I know market will buy it, but where would it find the money to fund the stock purchase?
Would it crash other company stocks so that investors start selling and purchasing Anthropic shares, or how does it work?
I'm curious to know if they generated this with Claude and what the prompt looked like.
Can someone help me understand how its "confidential" if they blog about it? Perhaps they simply mean the details of the S-1 are confidential for now?
The contents are confidential. They are just announcing they submitted it.
The S-1 itself isn't made public in a confidential filing.
Expect the token price to correlate with the stock price.
With SpaceX, OpenAI, and Anthropic, we're likely to see 3 of the largest IPOs ever (by a wide margin) this year. Will existing institutional investors trim other positions to allocate a lot of capital for these mega listings or is this not a concern?
Most likely. Funds generally don't have much unallocated cash, they operate fully invested, so three huge IPOs will force an asset rebalancing which can cause some liquidity drain from the rest of the market.
Plus as insider lockup periods expire, that's a ton of dollars pulled out of the market and into safer assets. It's going to be a huge net exit of capital.
I'd expect a lot of volatility and pretty heavy downward pressure across the rest of tech.
At least all the index funds are obligated to, right?
Based on current rules they wouldn't included in the S&P 500 for at least several years even based on optimistic scenarios.
Of course IIRC they looking into tweaking the rules to allow some handpicked extremely unprofitable companies in, due to "reasons"....
They are scared of underperfoming the market and failing to exist as an index. Losing money with everyone else is a more sustainable risk than losing money while other indexes go up.
Maybe. If you read the fine print they are not. They have the goal of matching the index returns, but they never say anywhere they have exactly the stocks in the index.
Index funds all make active choices and often hold companies not in the original index. They are more passive than a traditional funds that buys and sells all the time, but they still make active choices. When an index changes stocks they can look up the price - but the funds mirroring the index need to make real trades that if not carefully done will change the value of the stocks (and cause the fund to under perform the index), so index funds have plans to prevent this. Compared to a traditional fund an index fund looks passive and there is much much less for the manager to do - but that doesn't mean the managers do nothing.
Most index funds wait for at least a year before adding a new listing. The only exception that I'm aware of is QQQ and SpaceX.
Not true for Vanguard's total US stock market fund (VTSAX/VTI), the largest total US stock market fund in the world. Their CRSP index only requires 20 trading days post IPO, or 5 for large caps (this has been true for many years, this is not a recent change)
Technically they couldn't be added to the S&P 500 etc. until they become profitable.
If space x gets an exception, why wouldn't anthropic?
company must have a history of profitability before being included in the S&P 500
Index funds follow indices and often only rebalance quarterly
you and me will all be left holding a small cut of the bag
But only the amount the company floats for many index funds. So in the case of SpaceX, they are only floating 5% of the company. So the number of shares something like VTI has to buy is much smaller than the total market cap (5% of it).
Who’s going out of the gate first, Anthropic or Space X. Sequencing probably matters more than it should.
Got to dump this on everyone's SP 500 index fund before people figure out that there is a 95% drop in token usage when they are metered.
They are metered. That's why their ARR went from $9B to $45B in 6 months.
S&P 500 requires trailing 12 month profitability to be on the index. We won't see any of these on the S&P for at least a year or more.
The profitability requirements are potentially being dropped. Consultation just closed and may be implemented as soon as next week.
I thought S&P also changed the rules on this one
Reading these messages is getting me discussed. Is there any fund/index fund that is not breaking the rules to allow easier pump and dump from big players?
Only Nasdaq has changed their inclusion rules (at least for now).
What does it mean to submit confidentially – what's the process there? I assume it be made public when approved by the SEC?
It means that Anthropic has submitted a document that it intends to share with the public in order to solicit public investment. This document includes details about its business, financials/revenue, ownership structure, risks, etc...
The document itself is what's confidential until the SEC approves it, at which point Anthropic will release that document to the public and IPO.
Of course that fundraise was the last one: [0], everyone getting ready to dump their pre-IPO shares on to you as China catches up with their open models.
Better to do it now than to wait a day longer and the tokens are not getting any cheaper here.
Obviously OpenAI will file for IPO certainly this month, or even this week in response both SpaceX, and Anthropic.
Then AGI will then have been achieved externally.
[0] https://news.ycombinator.com/item?id=48313390
Time to short the market. We are at peak bubble.
"The stock market just did something eerily similar to the dot-com bubble top in 2000" - https://www.cnbc.com/2026/06/01/the-stock-market-just-did-so...
The market can remain irrational longer than you can remain solvent.
> The market can remain irrational longer than you can remain solvent.
And you can consistently beat the market as long as passive index investors believe in efficient markets.
Show me an index fund that persistently beats passive index funds. https://www.investopedia.com/warren-buffett-usd1-million-bet...
> Time to short the market.
post your position for all to see if you're so confident. Time in market is way better than timing the market. I'd rather ride through a downturn, buying at the same pace i always do, and come out the other side than try to time it. Been there done that and i got burned every time.
Shorting when there is a mania is way, way too risky
The amount of actual, hard cash revenue these companies are making is a different ballgame from the dot-com bubble.
Cisco was making loads of hard cash revenue during dotcom.
> Time to short the market. We are at peak bubble.
I've seen this comment on HN at least 5 times already.
I've been seeing this sentiment since I got into professional software development nearly 20 years ago.
This is actually the pin everyone was looking for that will pop this AI bubble, including the token cost falling in China and the release of open models that are good and run locally.
It could be, but the market could bounce right back. And if it does, it's hard to know who will emerge stronger. Anthropic could end up like Amazon, or it could end up like Yahoo.
Where are these open models that are as good as GPT and Claude and run locally?
Did mythos write the S-1? It better not have been a human given the amount of hype they are pushing.
Every post anthropic generates feels like misdirection and bad summarization using AI. There is no sense of who the audience for this post is for and includes a lot of redundant information.
Can't see the relevance of this comment to the post. You can do a Google search for "confidentially submits draft S-1 to the SEC" to see other examples of companies announcing these submissions and they're all written in the same way.
It's just a standard/template that most companies reuse.
https://www.figma.com/blog/s1-confidential-submission
https://www.prnewswire.com/news-releases/gemini-announces-co...
https://investors.navan.com/news-releases/news-release-detai...
https://www.round1-group.co.jp/docs/pdf/2026/20260507_news_e...
> This announcement is being published under Rule 135 of the Securities Act of 1933
It's a required public disclosure following a format traditionally used in mandatory public disclosures.
Is there any real reason to have generated announcements anyway? You could get more polished text with some copy editors and I can't imagine cost is really a big concern for it.
It is possible that they are dogfooding
It's a legal notice, what are you talking about?