Anysphere, the company behind Cursor, is in talks to raise capital at a staggering $10 billion valuation, fueled by the booming AI coding assistant sector. This potential deal, driven by investor enthusiasm and Anysphere's impressive ARR growth, highlights the rapid pace of AI adoption in coding and the willingness to pay high multiples for promising companies in this space.
The AI coding assistant space is heating up, with investors showing increasing interest and willingness to pay top dollar for promising companies.
Anysphere, the developer of the AI-powered coding assistant Cursor, is reportedly in discussions with venture capitalists to secure funding at a valuation nearing $10 billion, according to Bloomberg.
This potential funding round comes just three months after Anysphere's previous raise of $100 million, which valued the company at $2.5 billion (pre-money), a deal first reported by TechCrunch. The new round is anticipated to be led by Thrive Capital, a returning investor.
Neither Thrive Capital nor Anysphere have yet responded to requests for comment.
While Anysphere's earlier round valued the company at 25 times its $100 million ARR (as reported by The New York Times), it appears investors are now prepared to value rapidly expanding companies at even higher multiples. Recent reports in The Information suggest Anysphere's current annualized recurring revenue (ARR) may have already reached $150 million. If the deal materializes, the new valuation would represent a remarkable 66 times ARR.
Investor interest in AI coding assistants is exploding.
Anysphere is not alone in attracting such high valuations. Codeium, the company behind the AI coding editor Windsurf, is also reportedly raising capital at a valuation close to $3 billion. Kleiner Perkins, the lead investor in Codeium's round, valued the company at approximately 70 times its ARR of around $40 million.
Investors are observing that AI is being adopted most rapidly in coding tools, surpassing its integration in sectors like sales, law, and healthcare. This trend underscores the immediate and tangible benefits AI can bring to software development.
Other players in the AI-powered coding space are also gaining attention. Poolside, another company developing its own LLM for coding assistance, has reportedly been approached by investors in recent weeks, according to sources speaking to TechCrunch and The Information. Poolside has not yet responded to requests for comment.
Key Points: