OpenAI Reportedly Acquiring AI Coding Assistant Windsurf for $3 Billion

SAN FRANCISCO, CA – May 6, 2025 – OpenAI, the company behind ChatGPT, has reportedly agreed to acquire Windsurf, an artificial intelligence startup focused on coding assistance, for approximately $3 billion, according to reports from Bloomberg News and Reuters citing people familiar with the matter.

While the deal has reportedly been agreed upon, sources indicate it has not yet formally closed. If completed, this would represent OpenAI's largest acquisition to date and signifies a major strategic move into the rapidly growing market for AI-powered software development tools. Both OpenAI and Windsurf declined to comment on the reports.

Windsurf, formerly known as Codeium, was founded in 2021 by MIT graduates Varun Mohan and Douglas Chen. The company develops AI tools designed to assist programmers, including features like code auto-completion, bug detection, and chat-based project monitoring (Cascade). It also offers tools like Windsurf Previews, allowing developers to preview websites during development.

Key Details and Context:

• Valuation Surge: The reported $3 billion acquisition price is significantly higher than Windsurf's previous valuation of $1.25 billion, achieved after a $150 million funding round led by General Catalyst in August 2024. Other investors include Kleiner Perkins and Greenoaks.
• Market Position: Windsurf is reported to have approximately $40 million in annualized recurring revenue (ARR). The AI coding space is highly competitive, with rivals like Anysphere (maker of Cursor) reportedly seeking funding at a valuation near $10 billion with a higher ARR.
• Strategic Fit for OpenAI: Acquiring Windsurf would directly enhance ChatGPT's coding capabilities, a core function for many users. While ChatGPT Pro already offers tools like Code Interpreter and Canvas, integrating Windsurf's specific features like Cascade and Previews could significantly bolster its utility for developers and allow OpenAI to compete more directly with Microsoft's GitHub Copilot, Anthropic's Claude, and standalone tools like Cursor and Replit.
• Previous OpenAI Acquisitions: This potential deal follows other recent OpenAI acquisitions aimed at bolstering its infrastructure and capabilities, including search and database analytics startup Rockset and video collaboration platform Multi in 2024, and creative AI tool company Global Illumination in 2023.
• Industry Trend: The move reflects intense investor interest and competition in the AI sector, particularly in tools that enhance developer productivity. OpenAI itself is reportedly planning a massive $40 billion funding round led by SoftBank at a $300 billion valuation.

The potential integration of Windsurf's technology into ChatGPT could provide developers with more powerful, integrated AI coding assistance within the familiar chatbot interface, further solidifying OpenAI's position in the AI landscape.

(Note: Mashable's parent company, Ziff Davis, filed a lawsuit against OpenAI in April 2025 regarding copyright infringement in AI training data.)