OpenAI is reportedly close to acquiring Windsurf, an emerging player in the AI coding space, in a deal that could be valued around $3 billion. According to Bloomberg sources, the announcement might land later this week—potentially reshaping the landscape of AI-assisted programming tools.
Windsurf, formerly known as Codeium, has quickly become a favorite among developers for its streamlined coding assistant. But this potential acquisition is more than just another big buyout—it could place OpenAI in direct competition with one of its own portfolio companies.
The move raises eyebrows given OpenAI’s prior investment in Anysphere, the startup behind Cursor—another popular AI coding assistant. Cursor is not only a top contender in the space but reportedly brings in a much higher annualized recurring revenue (ARR) of $200 million, compared to Windsurf’s estimated $40 million ARR. Cursor has also been in funding talks at a $10 billion valuation, far surpassing Windsurf’s previously reported $2.85 billion valuation.
Insiders familiar with Cursor’s cap table have expressed concern that OpenAI’s decision to pursue Windsurf could undermine the credibility of its Startup Fund. So far, it’s unclear if OpenAI ever approached Cursor for a potential acquisition.
Still, hints of the Windsurf-OpenAI deal have been floating around. Windsurf users recently received an email offering a chance to lock in access to the coding tool for $10 per month—just ahead of a pending announcement. Meanwhile, OpenAI’s Chief Product Officer, Kevin Weil, published a video praising Windsurf’s technology, fueling further speculation.
Founded in 2021 by MIT alumni Varun Mohan and Douglas Chen, Windsurf has raised $243 million to date from notable investors such as Greenoaks Capital and General Catalyst. The startup has seen rapid traction but still lags behind its rival Cursor in terms of scale and revenue.
If the deal closes, OpenAI would gain direct control of Windsurf’s growing platform—likely integrating it deeper into its own ecosystem of developer tools. However, the potential fallout with other portfolio startups, especially Cursor, could introduce tension within OpenAI’s broader investment strategy.
For now, all eyes are on what’s expected to be a major announcement later this week. Whether it’s a strategic leap or a conflict of interest in the making, OpenAI’s next move could shake up the AI coding wars.
