AI coding platform Cursor has secured a $2.3 billion funding round, lifting its post-money valuation to $29.3 billion and placing the rapidly growing company among the most highly valued startups in the artificial intelligence sector. The new valuation is nearly triple its worth during its previous raise in June and highlights the intense investor interest in AI developer tools.
Cursor, originally launched inside applied research lab Anysphere in 2022, has become one of the leading players in AI-assisted software development. Its platform helps developers generate, edit and review code using proprietary in-house models that the company says produce more code than almost any other large language model in the field.
Backed by major investors and tech giants
The funding attracted participation from a wide range of prominent technology investors, including Accel, Thrive Capital, Andreessen Horowitz, DST Global and Coatue. Strategic backers Nvidia and Google also joined the round, signaling confidence in the company’s technology and long-term potential.
In a blog post announcing the raise, Cursor said the fresh capital will allow it to expand its research efforts and develop new product capabilities. “This funding will allow us to invest deeply in our research and build Cursor’s next magical moments,” the company wrote.
Cursor has grown rapidly since its tool launched in 2023, surpassing $1 billion in annualized revenue and expanding its team to more than 300 employees. Nvidia CEO Jensen Huang even described it as his “favorite enterprise AI service” in a recent CNBC interview.
Competition intensifies in the AI coding market
The market for AI-assisted coding tools has become increasingly crowded as companies race to capture developers looking to streamline their workflows. Cursor competes with OpenAI, Anthropic and Cognition, among others. Cognition acquired the coding startup Windsurf earlier this year, while OpenAI recently introduced its own tool, Codex.
Cursor itself was the target of acquisition interest. CNBC previously reported that OpenAI approached Anysphere about a potential purchase, but the discussions did not progress. Meanwhile, rival tools are also experiencing rapid adoption: Anthropic said in September that Claude Code has already generated more than $500 million in run-rate revenue since its launch, and Windsurf reached $82 million in annual recurring revenue prior to its acquisition.
Focus on growth, not going public
Despite its surge in valuation and revenue, Cursor’s leadership says a public offering is not on the near-term agenda. CEO Michael Truell told CNBC that the company is concentrating on building its team and expanding its capabilities before considering a market debut.
“Our immediate focus is on building out the company and growing the team, and we have a lot more to do before thinking about anything like going public,” Truell said.
In its announcement, the company emphasized that it still sees significant room for improvement and innovation. “Internally, we often talk about how high the ceiling is for how great Cursor can become, and how much work still remains to get there,” the team wrote.
