Say you joined Anthropic in 2024. The company offers you a competitive compensation package: a $400,000 salary and $1.3 million in equity. You’re feeling pretty cush.
Flash forward to July 2026. In the two years that you’ve worked there, the company’s valuation has grown from $18 billion to $965 billion. With Anthropic on the precipice of a public stock market debut, your equity in turn has ballooned by more than 5,000% to $72 million. Even by Bay Area tech standards, you have won the lottery.
This example — taken from a real midlevel member of the technical staff — is not anomalous. Thousands of employees at Anthropic and OpenAI are now watching their equity accounts inflate to stupefying heights. One former OpenAI employee, who spent less than three years at the company and whose equity is now worth more than $50 million, tells me he has a hard time comprehending this scale of wealth, which is “way beyond what I even know what to do with.”
The money pouring out of these two startups, both of which are preparing for an IPO, is not just redefining the scale of tech wealth but cleaving San Francisco’s tech scene into two. There’s the regular rich, and then there’s the stratospherically rich. The largest lottery jackpot in California’s history, in 2022, paid $2 billion. By comparison, Anthropic’s seven cofounders will be worth more than $15 billion each. Greg Brockman, the president of OpenAI, holds equity now valued at about $30 billion. If these companies go public, thousands of employees will become multimillionaires overnight, according to analysis from Hill.com, which tracks private market transactions.
“The level of wealth I’m seeing with these two companies is like nothing I’ve seen in my career,” says Tushar Kumar, the founder of Twin Peaks Wealth Advisors, who works with clients at OpenAI and Anthropic. These companies already pay their employees higher salaries than almost any other startup in history, and often more than big tech companies. Yet for most employees, Kumar says, “the majority of their money is in equity, not in salary.” The average equity grant among OpenAI’s some 5,000 employees is $1.5 million. Alex Caswell, a financial planner, says all of his clients at OpenAI and Anthropic are “shocked by what they now have available to them.” Employees of all kinds have seen their wealth grow “by magnitudes of 10” — whether they are research scientists with PhDs or, like one of his clients, a chef overseeing the cafeterias at OpenAI, who now has a net worth of more than $10 million.
The net effect is a surreal distortion of money in San Francisco. “Depending on your position, it could be the best of times or a time of great anxiety,” says Vijay Chattha, who owns VSC, a public relations firm for tech companies. “I’ve never seen something like this in my life, where something has such a dual energy to it.” Redfin estimates that, post-IPO, Anthropic and OpenAI employees will be worth enough, collectively, to buy nearly a third of all the homes in the San Francisco metro area. Chattha, feeling left out of this historic wealth-creation event, recently listed his vacation home in Sonoma County for $2.5 million, or $2 million in Anthropic shares. As he sees it, the one thing more valuable than money itself is a stake in Anthropic.
Since the Gold Rush of 1849, San Francisco has been a place where people come to get rich. Yet this boom is different, both because the scale of wealth is so much larger and because it is in the hands of fewer people. In past IPO cycles in tech history, “everyone was making money,” says Kumar. “The thing that feels different this time is not everyone’s making money.”
What is all of this concentrated wealth sloshing around the city going to do to the city? Will it permanently price out the have-nots, displacing San Franciscans who work outside the AI industry? Or will a flood of new money proverbially lift all boats? While the rise of OpenAI and Anthropic may solidify San Francisco’s image as the city building the future, it may also make San Francisco’s future more precarious.
Caswell says that his clients at Anthropic and OpenAI are hesitant to make concrete plans for their wealth, as if afraid to jinx it and pop the AI bubble. “People are still feeling like they haven’t secured the bag,” he says.
If it were his money, he jokes that “there would for sure be a Lamborghini in my driveway.” But many of his clients are frugal millionaires. “The funny thing about a lot of tech professionals is that they’re not really materialistic,” he says. “My wealthiest clients don’t really care about fancy sports cars. They don’t care about really nice watches. They’re extremely frugal.”
Loren Elliott for The Washington Post via Getty Images
Several other wealth advisors similarly tell me that their clients at Anthropic and OpenAI have conservative plans for their riches; one said a client was planning to sell their stock and reinvest it in index funds. The wildest plans I heard of involved quitting. “Their jobs are incredibly stressful,” Caswell tells me. “Almost every single one of them wants to retire early.”
I ask Caswell if any of his clients were considering donating their wealth philanthropically, given how many Anthropic employees, in particular, are associated with the effective altruism movement, and have pledged to give away a majority of their wealth to charity. Anthropic also offers a matching program for employees who wish to donate up to 25% of their equity to charitable causes. While Caswell has clients who have participated in that program, most of them weren’t factoring charity into their plans. Instead, many were planning to invest in startups or possibly start their own. “That’s what I’m seeing more than the desire to become philanthropic,” he says.
(After OpenAI’s tender offer last October, some employees reportedly put shares into charitable investment accounts, according to reporting in The Wall Street Journal. These vehicles typically do not give any money to charity right away, and instead allow employees to claim sizable tax deductions and to collect interest on their shares for years.)
The first place this money is landing is in real estate. “We’re talking about a very young cohort of engineers, so a lot of them are buying their first home,” says Stoyan Panayotov, the founder of Babylon Wealth Management, who has clients at OpenAI.
In San Francisco, the impending AI IPOs have collided with a heated housing market, leading to the general sense that AI money will make it impossible for anyone else to own a house. Rents have spiked over the last year, and buying a house has become challenging even for really rich people. “The reality is that a home you could buy for like $2.3 million last year is now going somewhere between $3 and $3.5 million,” says Helena Zaludova, a luxury real estate agent in San Francisco. “You have to be competitive.”
The median price of a single-family home in San Francisco is now $2 million — the highest of any city in the United States. Yet Zaludova rejects the idea that AI companies are responsible. “What we’re dealing with is more intense than I’ve seen before, but also totally logical,” she says, citing a long-awaited rebound after the pandemic numbers. “This is a way overdue correction.”
At a time when houses are selling for millions of dollars over the asking price, even high earners are feeling nervous about affording San Francisco. Wealth levels that were once considered extraordinary are now average, and tech workers outside AI worry they could be part of a rapidly downward middle class. Doctors and lawyers with $400,000 salaries are taking on second jobs, like training AI, to support themselves. And those who do not work in tech at all — the rest of the city’s economy of teachers, healthcare workers, restaurateurs, journalists, and small business owners — are bracing themselves for what could come next.
Why would the luminaries who made their fortunes here not want to help solve the problems that tech, in many ways, contributed to?Chris Larsen
“High rental costs and low vacancy rates are just going to push a lot of low-income households out of the city,” says Tim Thomas, who studies displacement at Berkeley’s Urban Displacement Project. San Francisco’s rental prices have grown by 21% in the last year — more than anywhere in the country — according to a recent report from the rentals website Zumper.
Thomas says that previous IPO cycles, where a group of employees suddenly have a lot more money, tended to make rents go up across the board. In a city like San Francisco, where the majority of buildings are protected by rent control, that can still lead to displacement in two forms. The first is “hard” displacement, which happens when people fall behind on rent, get evicted, and find themselves priced out of the market. In 2019, for example — a year when Lyft, Uber, Airbnb, and Slack went public — there were some 1,500 evictions in the city, twice the annual average. The second is “soft” displacement, where people leave on their own accord when the city starts to feel too expensive. Already, households earning $400,000 say they cannot afford the cost of childcare in the city, which is now subsidized for families that earn $230,000 or less.
Ted Egan, the chief economist of the city of San Francisco, rejects the idea of mass displacement, saying that while people moving to San Francisco would have to pay market price for rent, people who already live there are protected by rent control. He adds that while rents seem high, they are lower than they were in 2019, when they were three times the national average. In 2026, they’re only twice the national average.
Tech booms can also be good for cities. Past IPO cycles have led to higher employment and higher wages, even if those benefits were only felt within the tech sector. But while Anthropic and OpenAI are both growing, leasing bigger office spaces in the city and hiring more employees, their growth has been offset by massive layoffs in the industry at large. Across tech, workers are discovering that they are either extremely valuable to the project of building AI — and therefore worth as much as $300 million in compensation — or completely expendable.
Tech job listings in San Francisco are some 40% lower than they were before the pandemic. “We added 90,000 jobs in the first three years of the 2010s, and we’ve lost 40,000 jobs in the last three years,” says Egan. “So this does not look like a tech boom of the late 90s or the early 2010s or anything like that.”
And while employees do pay taxes to cash out equity, none of those taxes go directly to the city of San Francisco, which taxes businesses, but not individual wealth. In 2019, during another heated round of IPOs, a San Francisco Supervisor suggested an “IPO tax” to increase the city’s payroll tax on stock-based compensation. The policy was intended to generate $200 million in its first two years to address affordable housing and income inequality. But the proposal was pulled after intense pushback from the business community.
San Francisco added 90,000 jobs in the first three years of the 2010s. It’s lost 40,000 jobs in the last three years.
“The 2019 mood was sort of like, this is an oil well, and we’re not getting enough money out of it,” says Egan. After COVID, which emptied out San Francisco, the city has tried to incentivize businesses to remain in the city (nearly a third of San Francisco’s office space is vacant today). “It’s driven the conversation to say we need to be a bit more careful.”
San Francisco collects about $1.5 billion a year in business taxes. (Los Angeles, which is about five times larger in population, generates about $800 million.) Historically, the city has been sheepish about asking its richest residents for more money. But Mayor Daniel Lurie, who made his connections to the wealthy elite a part of his campaign, has worked with several of the city’s billionaires to fund various projects. Salesforce CEO Marc Benioff has made large contributions to public schools, venture capitalist Michael Moritz has donated to homelessness projects, and crypto billionaire Chris Larsen recently made a $5 million investment in the Tenderloin, following previous donations to police and public safety efforts in San Francisco.
Could a wave of thousands more multimillionaires in San Francisco propel a wave of people using their own money to make the city better? Larsen, in an email, tells me more people in his tax bracket should be chipping in: “The tech industry calls San Francisco home, and its impact on this city cannot be overstated. Why then, would the luminaries who made their fortunes here not want to help solve the problems that tech, in many ways, contributed to?”
Thomas, the displacement researcher, worries that a likelier impact from the influx of AI wealth is that it could skew the overall composition of the city in a way that permanently changes its culture, and its politics. “That, to me, is a big threat to a major city like San Francisco,” Thomas says. He pointed to Marin, the affluent county directly north of San Francisco, where wealthy residents have resisted efforts to add public transit or higher-density zoning, effectively insulating it from the rest of the Bay Area. San Francisco could eventually become a similar type of enclave where only a wealthy few can afford to live.
Sam Altman acknowledges that thousands of new multimillionaires will skew the division of “rich” and “poor,” and has suggested the need to support this growing underclass as AI upends the economy. In April, OpenAI published a document calling for better policies in the “industrial age” of AI, such as providing a universal basic income.
If anyone could pay for such a thing, it would be these AI companies themselves. The combined value of Anthropic and OpenAI is $1.8 trillion, roughly equivalent to the gross domestic product of South Korea, and enough to pay off the entire United States federal budget deficit. If you distributed this sum evenly to every resident in San Francisco, each person would receive $2 million, or about 15 times the median household income. Yet the spoils of this year’s massive IPO season will almost certainly remain with a lucky few.
San Francisco is built on fault lines, transformed time and again by booms and busts. It has reinvented and rebuilt itself more than once. But as billions in paper wealth turn into real-world cash, the city may have to confront a new identity based on who gets to stay, and what it takes to live and work there.
“Nobody really knows the answer right now,” says Egan, the city economist. “We’re almost certainly going to see this in San Francisco before we see it anywhere else.”
Arielle Pardes is a reporter in San Francisco covering the business and culture of technology.
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