Anysphere, a startup that has developed an AI-powered coding assistant called Cursor, recently secured over $60 million in a Series A financing round. The funding round was co-led by Andreessen Horowitz and Thrive Capital, with participation from Patrick Collison, co-founder and CEO of Stripe. Anysphere, a16z, and Collison have not yet commented on the deal, while Thrive declined to provide a statement.
The company was founded by Michael Truell, Sualeh Asif, Arvid Lunnemark, and Aman Sanger while they were students at MIT. Truell and Sanger later participated in Neo Scholars, a prestigious mentorship program for undergraduate students in technical fields. Neo, which operates an accelerator and a venture fund, led Anysphere’s pre-seed investment. Last year, the company raised $11 million in a seed round led by OpenAI Startup Fund, with participation from former GitHub CEO Nat Friedman, Dropbox co-founder Arash Ferdowsi, and other angel investors.
Anysphere is part of a growing field of AI coding copilot startups. Similar companies, such as Cognition, Poolside, Magic, and Augment, are also working towards making software development more efficient and streamlined.
Investor interest in this space comes as no surprise. During Microsoft’s recent earnings call, CEO Satya Nadella revealed that GitHub Copilot, an AI-powered tool for code writing, has already surpassed the revenue that GitHub generated before it was acquired by Microsoft for $7.5 billion in 2018. It is estimated that GitHub’s revenue at the time of acquisition was as high as $300 million. This suggests that approximately 30 million developers worldwide are paying Microsoft $100 annually for GitHub’s individual subscription, indicating a significant market demand for tools that enhance coding productivity.
Anysphere has also experienced rapid growth in revenue and usage. In July, Business Insider reported that the company was in the process of raising a new funding round with a target valuation of $400 million.
The competitive landscape in the AI coding copilot market is expected to intensify due to the high demand from developers and the potential for significant revenue generation. With Anysphere’s innovative AI-powered coding assistant, Cursor, and its growing user base, the company is well-positioned to capitalize on this market opportunity.