OpenAI, the company behind the ChatGPT platform, has reached an agreement to buy AI enabled coding platform Windsurf for $3 billion, as reported by Bloomberg on Tuesday.
This follows the previous reports which observed that OpenAI was ‘in talks’ to buy Windsurf.
When the acquisition does take place, OpenAI will compete with coding platforms like Cursor, Lovable, Vercel’s v0, Replit, and more.
Recently, CNBC also reported that OpenAI also looked towards buying Anysphere’s Cursor, before landing on Windsurf.
Windsurf was launched initially as Exafunction, a GPU optimisation platform in 2021, by MIT graduates Varun Mohan, and Dogulas Chen.
Given the advent of generative AI, the startup pivoted towards building a coding platform called Codeium, which eventually evolved to what is called today as Windsurf.
As per Crunchbase, the company has raised over $240 million in funding. While the startup is currently valued at $1.25 billion, TechCrunch reported earlier this year that Windsurf is planning to raise a new round of funds, which will value it at $3 billion.
The company also announced updates to their free tier. Cascade can now be used in write mode, users receive 5–25 Cascade prompt credits each month, and both Fast Tab and Cascade Base are available without any restrictions.
The competing platform Cursor, through its parent Anysphere, has recently raised a $900 million investment, led by Thrive Capital, Andreessen Horowitz (a16z), and Accel Ventures, the Financial Times reported on Monday.
This is said to more than triple the company’s valuation to $9 billion.
Having said that, OpenAI has increased its focus towards integrating powerful coding capabilities for users in their platforms. OpenAI mentioned that newly released o3 and o4-mini models achieve higher benchmark numbers in tests like Codeforces competition code than their predecessors, citing a 20% fewer major errors over OpenAI o1, as tested by external experts.
Besides, Aider’s polyglot coding leaderboard ranks o3 up at the top in terms of accuracy. While the leaderboard mentions the price being higher than Gemini, the o4-mini is still cheaper than the Claude 3.7 Sonnet, and o1.
