Anthropic is reportedly close to finalising a funding round that could increase its valuation to $170bn.

The AI startup is expected to raise up to $5bn in this latest investment effort, Bloomberg reported, quoting a person familiar with the matter.

US-based investment group Iconiq Capital, which manages the wealth of prominent tech figures such as Meta’s Mark Zuckerberg and LinkedIn co-founder Reid Hoffman, is set to lead the investment.

In addition to Iconiq, Anthropic is in talks with the Qatar Investment Authority and Singapore’s sovereign fund the Government of Singapore Investment Corporation to participate in this funding round.

It is also holding discussions with the United Arab Emirates’ state investment fund MGX and existing partner Amazon for potential investment.

Recently, Anthropic CEO Dario Amodei informed staff of the company’s decision to begin accepting investments from the Middle East.

The deal is yet to be formally finalised, and details may evolve. Both Iconiq and Anthropic have declined to comment on the ongoing funding discussions.

This new funding round would significantly increase Anthropic’s valuation.

A valuation of $170bn would place Anthropic among the most valuable private tech companies worldwide, behind OpenAI, valued at $300bn, and SpaceX at $400bn, according to a Financial Times report.

Earlier this year, Anthropic was valued at $61.5bn in a $3.5bn funding round led by Lightspeed Venture Partners, which is also expected to participate in the current round.

Founded in 2021 by former OpenAI employees, Anthropic focuses on developing AI solutions.

The new funding may further bolster its competition with OpenAI and Elon Musk’s xAI, both of which have secured substantial capital this year for AI model development.