OpenAI pursued Cursor maker before entering into talks to buy Windsurf for $3B

​OpenAI is currently in advanced discussions to acquire Windsurf, an AI-powered coding assistant formerly known as Codeium, for over $3 billion. This potential acquisition would mark OpenAI's largest to date and signifies its strategic push to solidify its position in the AI coding tools market.​

Background: The Cursor Consideration

Before turning its attention to Windsurf, OpenAI had reportedly engaged in acquisition talks with Anysphere, the developer of Cursor, another prominent AI coding assistant. Cursor integrates Anthropic's Claude 3.5 Sonnet model and has garnered a significant user base, boasting over a million daily users and annual recurring revenue exceeding $100 million as of January 2025. Despite OpenAI's investment in Anysphere through its Startup Fund, acquisition discussions did not materialize, possibly due to Anysphere's high valuation nearing $10 billion. ​

Strategic Shift to Windsurf

With the Cursor deal not progressing, OpenAI shifted focus to Windsurf. Founded in 2021 by MIT graduates Varun Mohan and Douglas Chen, Windsurf offers a robust AI coding assistant and has been gaining traction among developers. The company has raised over $200 million from investors like Kleiner Perkins, Greenoaks Capital, and General Catalyst, and was recently valued at approximately $2.85 billion. ​

Implications and Industry Dynamics

OpenAI's pursuit of Windsurf underscores the intensifying competition in the AI coding assistant space, with major players like Microsoft (with GitHub Copilot) and Anthropic (with Claude) also vying for dominance. The acquisition could enhance OpenAI's offerings, especially when integrated with its own models like o3 and o4-mini, potentially setting new standards in AI-assisted coding. ​

However, the move also raises questions about potential conflicts of interest, given OpenAI's prior investment in Cursor. Industry observers are keenly watching how this acquisition might reshape the landscape of AI coding tools and what it means for competition and innovation in the sector.​

As the deal progresses, it will be essential to monitor regulatory responses and the broader impact on the AI development community.