Analysis of Anthropic's Pre-IPO Corporate Structure and Board Control

Anthropic recently amended its certificate of incorporation ahead of a planned IPO, prompting an analysis of its current pre-IPO governance structure. The board of directors consists of seven seats, distributed to balance founder control, investor interests, and long-term public benefit oversight.

Board Composition and Voting Power

The board seats are allocated as follows:

• 2 seats elected by common shareholders (currently Dario Amodei and Daniela Amodei).
• 1 seat elected by voting preferred shareholders, known as the Electing Preferred Director (currently Yasmin Razavi).
• 4 seats elected by the Long Term Benefit Trust (LTBT) (currently Reed Hastings, Chris Liddell, Vas Narasimhan, and one vacant seat).

In the event of a tie, the CEO retains the power to break the vote. While the board can issue additional stock by simple majority, anti-dilution provisions require the Electing Preferred Director's approval for specific issuances, such as new employee option plans.

The Long Term Benefit Trust

The LTBT owns one class T share of Anthropic PBC following a 1000:1 reverse split. The trust operates under a non-public trust agreement, and its trustees are appointed by the trust itself. The certificate of incorporation implies the LTBT is party to a non-public Voting Agreement, which may dictate director appointments. The LTBT must be notified of significant actions, such as the transfer of significant models or majority share transfers, allowing for potential intervention.

Transparency Concerns

The author argues that Anthropic and the LTBT lack sufficient transparency regarding control over increasingly capable AI models. The non-public nature of the trust agreement and Voting Agreement limits public oversight. The author advocates for immediate disclosure of these documents rather than waiting for the IPO process.