Cursor in talks to raise at a $10B valuation as AI coding sector booms

Investor interest in AI coding assistants is skyrocketing.

Anysphere, the creator of AI-driven coding assistant Cursor, is currently in discussions with venture capitalists to secure funding at a valuation close to $10 billion, as reported by Bloomberg.

If the deal goes through, it will follow Anysphere’s recent successful fundraising of $100 million at a pre-money valuation of $2.5 billion, according to DailyTech. The new funding round is anticipated to be spearheaded by existing investor Thrive Capital.

Thrive Capital and Anysphere have not yet responded to requests for comments.

Despite Anysphere’s previous valuation being 25 times its $100 million ARR (as per The New York Times), investors are now willing to value rapidly growing companies at even higher multiples. The Information suggests that Anysphere’s current annualized recurring revenue (ARR) could have reached $150 million, potentially resulting in a valuation of 66 times ARR in the new deal.

Anysphere is not the only company attracting such high valuations from investors.

Codeium, the company behind AI coding editor Windsurf, is also raising funds at a valuation nearing $3 billion, according to DailyTech. Kleiner Perkins, the lead investor in Codeium, has valued the company at approximately 70 times its $40 million ARR.

Investors note that AI is making significant strides in coding tools, surpassing its adoption in sales, law, healthcare, and other industries.

Recent reports indicate that investors have shown interest in Poolside, another AI-powered coding company working on its own LLM. However, Poolside has not yet commented on the matter.