Alphabet stands to pocket potentially $100 billion or more from its 2015 investment in Elon Musk’s SpaceX, and Google CEO Sundar Pichai says the explosion of artificial intelligence is creating even more opportunities for the company to deploy capital directly into promising startups.
In a wide-ranging conversation with Stripe co-founder John Collison posted on Tuesday, Pichai made clear that Alphabet is moving beyond its traditional venture arms to make bigger, more direct bets as the capital demands of frontier AI companies continue to escalate.
“You know SpaceX, Anthropic and so on so, I think now with the AI shift, there are more opportunities on which we can deploy capital in a good way and so we are doing that,” Pichai said.
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The remarks come as Alphabet joins other tech giants, including Nvidia, Microsoft, and Amazon, in writing large checks off the balance sheet rather than routing everything through its early-stage venture group GV or growth-stage arm CapitalG. The scale of today’s AI race often requires investments in the hundreds of millions or billions of dollars, far beyond what conventional venture funds typically provide.
Alphabet’s original $900 million investment in SpaceX in 2015 came at a valuation of roughly $12 billion. In February, SpaceX merged with Musk’s xAI in a transaction that valued the combined company at $1.25 trillion. Assuming Alphabet retained its full stake, that position is now worth around $100 billion — and could climb higher.
Reportedly, SpaceX confidentially filed for an IPO last week and is reportedly seeking a valuation as high as $1.75 trillion, which would rank among the largest offerings ever.
Anthropic has delivered similarly outsized returns. Google invested $300 million in the AI lab in 2023 for roughly a 10% stake, followed by another $2 billion infusion. The company has since put in additional capital, bringing its total investment above $3 billion. Anthropic’s valuation has soared to $380 billion as of its most recent round in February, and Google now reportedly owns about a 14% stake. The partnership also carries strategic weight: Anthropic has committed billions of dollars to Google’s tensor processing units and cloud infrastructure.
Pichai emphasized that Alphabet aims to be disciplined with its capital.
“To the extent you’re bullish on ROIC, you want to invest every last dollar you can there,” he said, referring to return on invested capital.
“We felt our investment in Stripe was being a good steward of our capital,” he added, noting the fintech company’s valuation has climbed more than 17-fold since GV participated in a $150 million round in 2016. Stripe was valued at $159 billion as of February.
Pichai also reflected on Alphabet’s autonomous vehicle unit, Waymo, which raised its first external round in 2020 at $2.25 billion. Earlier this year, Waymo closed a $16 billion funding round at a $126 billion valuation, with Alphabet participating alongside outside investors.
“I would have been glad to invest more capital in Waymo earlier, but we weren’t at the level of maturity to do that,” Pichai said.
The comments paint a picture of a company that has grown far more comfortable writing large checks as its core search and advertising businesses continue to generate enormous cash flow. With AI driving unprecedented capital needs across the industry, Pichai sees a chance for Alphabet to put that cash to work in high-conviction opportunities that can deliver both financial returns and strategic advantages — whether through direct ownership stakes or deep commercial partnerships like the one with Anthropic.
This marks a notable evolution for Alphabet. For years, the company channeled most of its startup investing through GV and CapitalG. Now, with the AI boom demanding ever-larger sums and longer time horizons, Alphabet is increasingly willing to step in directly from the parent company balance sheet.
The approach mirrors what other tech giants have done to secure access to cutting-edge technology and infrastructure while capturing meaningful upside.
Pichai’s conversation with Collison, whose own company, Stripe, has been a major winner for Alphabet, underscored a consistent theme: when the opportunity is right, and the potential return on invested capital is compelling, Alphabet is prepared to move aggressively.
As the early bets on SpaceX and Anthropic have already paid off handsomely, the question now is how much further the company will lean into similar large-scale investments as the AI race intensifies.