Why OpenAI wanted to buy Cursor but opted for the fast-growing Windsurf

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Anysphere, maker of AI coding assistant Cursor, is growing so quickly, it’s not in the market to be sold, even to OpenAI, a source close to the company tells TechCrunch.

It’s been a hot target. Cursor is one of the most popular AI-powered coding tools and its revenue has been growing astronomically – doubling on average every two months, according to another source. Anysphere’s current average annual recurring revenue is about $300 million, according to two people. 

The company previously walked away from early acquisition discussions with OpenAI, after the ChatGPT maker approached Cursor, two sources close to the company confirmed, and CNBC previously reported. Anysphere has also received other acquisition offers that the company didn’t consider, according to one of these sources. 

Cursor turned down the offers because the startup wants to stay independent, said two people close to the company. Instead, Anysphere has been in talks to raise capital at about a $10 billion valuation, Bloomberg reported last month. 

Although it didn’t nab Anysphere, OpenAI didn’t give up on buying an established AI coding tool startup. OpenAI talked with more than 20 others, CNBC reported.

And then it got serious over the next fastest-growing AI coding startup, Windsurf, with a $3 billion acquisition offer, Bloomberg reported last week. While Windsurf is a comparatively smaller company, its ARR is about $100 million, up from $40 million in ARR in February, according to a source. 

Windsurf has been gaining popularity with the developer community, too, and its coding product is designed to work with legacy enterprise systems. Windsurf did not respond to TechCrunch’s request for comment. OpenAI declined to comment on its acquisition talks. 

OpenAI is likely shopping because it’s looking for its next growth areas as competitors such as Google’s Gemini and China’s DeepSeek put pricing pressure on access to foundational models. 

Moreover, Anthropic and Google have recently released AI models that outperform OpenAI’s models on coding benchmarks, increasingly making them a preferred choice for developers.

While OpenAI could build its own AI coding assistant, buying a product that is already popular with developers means the ChatGPT-maker wouldn’t have to start from scratch to build this business.

VCs who invest in developer tool startups are certainly watching. Speculating about OpenAI’s strategy, Chris Farmer, partner and CEO at Signal Fire, said, “They’ll be acquisitive at the app layer. It’s existential for them.”