A $7 billion horse race: Goldman Sachs and Morgan Stanley battle to lead OpenAI and Anthropic IPOs

Of course, the big hedge and mutual funds, as well as insurers, endowments and sundry other institutional investors, are super-hungry to get the biggest possible share allocations for both of these mega-IPOs, just as in the SpaceX deal. It’s been widely reported that both Anthropic and OpenAI have chosen Goldman and Morgan Stanley as their two top book runners, but haven’t determined who’ll get the all-important lead left designation. Hence, “They’ll need to spread their bets by gaining favor with both,” says Jay Ritter, the University of Florida professor who’s world’s top academic expert on IPOs.

Why is being the top underwriter so important? Ritter explains that the bank in that position gets to determine how many of the shares go to each fund. Other underwriters share in the fees, and are expected to provide analyst coverage, but do not participate in the share allocation. That’s the power that goes to the lead left banker, the position Goldman occupies in the SpaceX deal. And the way the funds ensure they get the maximum possible allocations, says Ritter, is paying the lead left underwriter lots of “soft dollars.” Those rewards are defined as the amount that the commissions paid on trades exceed the bank’s cost to execute the transactions. Rule of thumb: The more soft dollars a fund sends the lead left bank, the greater the portion of IPO shares they’ll get in return.

Now, says Ritter, the funds need to hedge their bets by sending both Goldman and Morgan Stanley lots of soft dollars to guarantee they’re well placed with both firms, in case either or both get the lead in either or both of the historic IPOs. “If you don’t know who’s going to be the lead left bank, you’d want to be using soft dollars to build up very profitable accounts at both banks in order to get the maximum number of shares,” says Ritter.

SpaceX provides a good example of why the top underwriter can make multiples of the amounts versus the other banks in the offering. In that deal, the fees for raising an expected $86 billion will equal roughly $600 million. But for Wall Street, the big money flows from the IPO’s “pop,” the jump over the offer price on the opening day of trading. The banks, in coordination with the issuer, regularly underprice the stock to get that bump on the pretext that giving investors a quick profit is essential to making them loyal, long-term shareholders. The media also regularly salutes the first day rise as the best measure of a deal’s success. Ritter’s data shows that around three-quarters of all offerings get a pop, and that the average increase is 19%.

In the SpaceX case, an opening-day vault of 20% on day one would give the IPO investors a gain of over $17 billion. Ritter reckons that at least 30% of that windfall would cycle back to the banks in soft dollars. That’s around $5 billion, more than eight-times the amount collected in fees, and the lead left gets by far the biggest portion. So securing that role was an immense coup for Goldman. But SpaceX presents less than half the total potential take for the Big Three AI offerings of 2026. Both OpenAI and Anthropic are expected to raise at least $60 billion each. That total of $120 billion-plus is 40% greater than the SpaceX raise.

At the SpaceX rate of 0.75%, the gross spread would come to $900 million. But once again, a big pop would generate a fee-swamping flood of soft dollars. Say both stocks ramped 20% on day one. The funds, and a lesser crew of retail clients, would gain $24 billion, and if the usual soft dollars boomerang back to the banks, they’d pocket over $7 billion—once again most of it going to the lead left.

On OpenAI, Kalshi gives Goldman a 73% chance of prevailing, and PolyMarket puts the odds at even for Anthropic. Meanwhile, Ritter believes, the funds are deploying soft dollars well in advance to boost their status with both firms. They each showed blowout results in sales and trading last year; Goldman grew 18% in the category to a record $41.5 billion, and Morgan Stanley expanded 17% to $33.1 billion.

Both Anthropic and OpenAI have filed confidential draft registration statements, and we don’t yet know the timing of the debuts. Yet as Ritter points out, Goldman and Morgan Stanley are already collecting soft dollars big time based on their chances of leading one or both deals. “I expect to see more great results for both firms in sales and trading in the coming quarters based on that trend,” he says. For the funds, the IPO game’s so lucrative that if you have two frontrunners for lead left, make sure you raise your standing as high-value customer for both.