OpenAI is reportedly in the talks to buy Windsurf, a popular AI coding assistant in a $3 billion deal. If this deal comes through, it would put OpenAI in direct competition with a number of other AI coding assistant providers including Anysphere, the maker of Cursor, which OpenAI backed through its OpenAI Startup Fund.
OpenAI’s Chief Product Officer had released a video on Wednesday, praising Windsurf’s abilities. Windsurf, formerly known as Codeium, is like Cursor and Replit — a tool developers use to “vibe code,” which means to have AI models assemble code quickly for new software. Andrej Karpathy, a former OpenAI co-founder, coined the term in a post on social media site X in February.
https://x.com/karpathy/status/1886192184808149383?lang=en
Windsurf claims that using its platform can increase developers’ productivity anywhere between 40% to 200% by decreasing PR (pull request) cycle times, maintaining code standards, and increasing flow state. Currently, the AI coding startup has a customer base of over 1000 enterprises.
Windsurf has been in talks to raise fresh funds at a $2.85 billion valuation led by Kleiner Perkins, according to TechCrunch. The company has reached about $40 million in annualized recurring revenue (ARR). Founded in 2021 by Varun Mohan and Douglas Chen, Windsurf has since raised $243 million from investors including GreenOaks Capital and General Catalyst, according to PitchBook data.
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This deal would also become OpenAI’s biggest acquisition. OpenAI has made several smaller acquisitions including analytics database provider Rockset and video collaboration platform Multi.
OpenAI has also been in the talks to buy io Products, an AI startup founded by its own CEO Sam Altman, and Apple designer John Ive for $500 million. Sources say that OpenAI is either planning for an acquisition or a strategic partnership with the aim of integrating the venture’s product engineering team into its ecosystem.
Recently, OpenAI has closed a $40 billion funding round, touted the largest tech investment on record, at a thumping $300 billion valuation.