OpenAI to acquire Windsurf for $3 billion, reports say

OpenAI‘s acquisition of Windsurf for approximately $3 billion represents a significant expansion into AI-assisted coding tools, potentially strengthening ChatGPT‘s coding capabilities amid increasing competition. This deal, reported by Bloomberg News but not yet closed, would mark OpenAI’s largest acquisition to date and comes as Windsurf (formerly Codeium) has been rapidly increasing in valuation, having reached $1.25 billion last August after a funding round led by General Catalyst.

The big picture: OpenAI has reportedly agreed to acquire AI coding tool Windsurf for approximately $3 billion, according to Bloomberg News sources familiar with the matter.

• The deal has not yet closed and neither company has officially confirmed the acquisition.
• If completed, this would represent OpenAI’s largest acquisition to date and a major expansion of its capabilities in the AI-assisted coding space.

Behind the numbers: Windsurf’s valuation has more than doubled since its last funding round in August 2023.

• The company, formerly known as Codeium, was valued at $1.25 billion following a $150 million funding round led by venture capital firm General Catalyst last year.
• Prior to the reported acquisition, Windsurf had been in talks with investors including General Catalyst and Kleiner Perkins to raise funding at the same $3 billion valuation.

Why this matters: The acquisition would significantly enhance OpenAI’s position in the competitive AI coding assistance market.

• OpenAI has been iteratively improving ChatGPT’s coding capabilities with each new model release, but faces increasing competition from specialized tools.
• Integrating Windsurf’s technology could accelerate OpenAI’s ability to offer more sophisticated coding assistance to developers.

Key investors: Windsurf has attracted backing from major venture capital firms before the reported acquisition.

• General Catalyst led Windsurf’s previous funding round and was reportedly involved in recent investment discussions.
• Other significant investors include Kleiner Perkins and Greenoaks.