OpenAI Explores Cursor Acquisition Before $3B Talks to Buy Windsurf
In a recent development in the tech industry, OpenAI has initiated discussions to acquire the AI coding company Windsurf for a substantial $3 billion. This news has sparked curiosity among enthusiasts and experts alike, particularly regarding why OpenAI did not pursue the acquisition of Anysphere, the creator of the popular coding assistant, Cursor.
OpenAI’s Investment in Anysphere
OpenAI’s interest in Anysphere is not new, as the OpenAI Startup Fund has been an investor in the company since its seed round in late 2023. Anysphere, known primarily for its product Cursor, has been rapidly gaining traction in the coding assistant market.
Failed Acquisition Talks
According to a recent report from CNBC, OpenAI did approach Anysphere regarding a potential acquisition in both 2024 and earlier this year. However, these discussions did not materialize into a deal. In the meantime, Anysphere is reportedly in negotiations to raise capital at an impressive valuation of around $10 billion, as highlighted by Bloomberg.
Importance of Code Generation Market
The shift in OpenAI’s focus towards Windsurf emphasizes the growing significance of capturing a share of the code generation market. Windsurf is currently generating approximately $40 million in annualized recurring revenue (ARR), according to a TechCrunch report from February. In comparison, Anysphere’s Cursor boasts a much higher ARR of about $200 million.
OpenAI’s Codex CLI and Market Strategy
Although OpenAI recently released its Codex CLI “agent,” capable of writing and editing code, the decision to pursue Windsurf indicates that the company is keen on expanding its capabilities rather than waiting for the CLI to establish its presence in the market.
- OpenAI’s acquisition of Windsurf: $3 billion
- Anysphere’s valuation: $10 billion
- Windsurf’s ARR: $40 million
- Anysphere’s Cursor ARR: $200 million
As the tech landscape evolves, it remains to be seen how these acquisition strategies will shape the future of coding assistants. For more insights into the latest trends in AI and coding technologies, visit our AI News page.
