SpaceX to acquire vibe coding startup Cursor for $60B
SpaceX announced plans to acquire Cursor, the developer of a popular vibe coding platform, for $60 billion in stock. The deal is expected to close by the end of the quarter. This acquisition follows a previous partnership and could accelerate Cursor's AI development and impact xAI's product lineup.
Newly public SpaceX Corp. today announced plans to acquire Cursor, the developer of a popular vibe coding platform, for $60 billion in stock.
The companies expect to close the transaction by the end of the quarter.
The move is not unexpected. In April, SpaceX partnered with Cursor to develop artificial intelligence models optimized for coding tasks. The space flight company stated at the time that it would either pay $10 billion for the collaboration or buy Cursor by year’s end.
Cursor, officially Anysphere Inc., was reportedly looking to raise funding at a more than $50 billion valuation prior to the partnership. Nvidia Corp. was expected to participate in the round. The chipmaker and Cursor’s other backers have invested more than $3 billion in the company since its launch.
The steep acquisition price reflects the popularity of Cursor’s vibe coding platform. CNBC reported in May that the company has more than 1 million daily active users. Cursor enables developers to build application modules, rewrite legacy code in a new language and perform other complex tasks using prompts.
Earlier this year, the platform received a major upgrade that enhanced its AI agent capabilities. When Cursor receives a complex task, it splits the project into smaller steps and assigns each one to a different agent. The agents run in separate cloud-based sandboxes. Developers can customize them by uploading instructions on how specific coding tasks should be performed.
Cursor’s platform uses a mix of third-party and custom AI models. Its newest in-house algorithm, Composer 2.5, debuted in May. SpaceX reportedly provided Cursor with access to tens of thousands of graphics cards to support the development of the model.
Cursor built Composer 2.5 using an algorithm called Muon that speeds up AI training. According to the company, its implementation of Muon can complete some tasks that usually require 16 graphics cards using just eight. For added measure, Cursor provided Composer 2.5 with 25 times as many synthetic training tasks as its previous-generation model.
The company’s sale to SpaceX may accelerate its AI development roadmap. When the rocket maker merged with xAI Holding Corp. earlier this year, it gained access to data centers with hundreds of thousands of Nvidia Corp. chips. However, it’s unclear how much of that computing capacity will be available to the Cursor team. SpaceX recently inked two data center deals with Anthropic PBC and Google LLC that are together worth $2.15 billion per month.
It’s also unclear how the acquisition will affect xAI’s product development efforts. In May, the SpaceX unit launched a model called Grok Build 0.1 that is specifically optimized to power coding agents. It also provides a programming assistant called Grok Build that offers similar abilities to Cursor.
Earlier this month, xAI brought Composer 2.5 to Grok Build users. The SpaceX unit’s models, meanwhile, are available in Cursor. More product integrations could follow after the acquisition closes. Additionally, it’s possible that SpaceX will discontinue some overlapping Cursor and xAI products to streamline its AI engineering efforts.
Photo: Unsplash
A message from John Furrier, co-founder of SiliconANGLE:
Support our mission to keep content open and free by engaging with theCUBE community. Join theCUBE’s Alumni Trust Network, where technology leaders connect, share intelligence and create opportunities.
15M+ viewers of theCUBE videos, powering conversations across AI, cloud, cybersecurity and more
11.4k+ theCUBE alumni — Connect with more than 11,400 tech and business leaders shaping the future through a unique trusted-based network.
About SiliconANGLE Media