Cursor Raises $100M at $2.6 Billion Valuation Led by Thrive Capital

Table of Contents

AI-Powered Coding Assistant Cursor Sees Rapid Growth and Increased Investor Interest

In a significant funding round, Anysphere, the developer of AI-powered coding assistant Cursor, has raised $100 million in its Series B funding at a post-money valuation of $2.6 billion. This new investment comes just four months after the company’s $60 million Series A funding at a valuation of $400 million.

Led by Returning Investor Thrive Capital

The latest round is being led by returning investor Thrive Capital, with participation from a16z (Andreessen Horowitz), who also joined the previous round. This significant investment demonstrates the growing interest in Anysphere and its AI-powered coding assistant Cursor.

Rapid Revenue Growth

Anysphere’s revenue has grown significantly since April, from $4 million annualized recurring revenue (ARR) to $48 million ARR in October, implying a staggering 12 times growth in just six months. This rapid revenue growth is likely a key factor contributing to the increased investor interest and valuation.

Freemium Model with Tiered Pricing

Cursor offers developers a freemium model with tiered pricing, where users can try out the service for two weeks before being converted to paying customers. The company charges $20 per month for its pro offering and $40 per month for a business subscription designed for larger teams and organizations.

Notable Clients

Anysphere’s notable clients include OpenAI, Midjourney, Perplexity, Replicate, Shopify, and Instacart, highlighting the growing demand for AI-powered coding assistants in various industries.

Company Background

Anysphere was co-founded in 2022 by Michael Truell, Sualeh Asif, Arvid Lunnemark, and Aman Sanger while they were students at MIT. The company has received seed funding from OpenAI’s accelerator and other notable investors, including Neo, Stripe co-founder Patrick Collison, former GitHub CEO Nat Friedman, and Dropbox co-founder Arash Ferdowsi.

Market for AI-Powered Coding Assistants

The market for AI-powered coding assistants is highly competitive, with several players such as Augment, Codeium, Magic, and Poolside offering similar services. However, Cursor stands out as a popular choice among developers, and its freemium model has contributed to its rapid growth.

Increased Investor Interest

In recent months, investors including Index Ventures and Benchmark were vying for a chance to back Anysphere. The company’s rapid growth and increased investor interest have made it one of the most-watched startups in the Valley.

Conclusion

Anysphere’s $100 million Series B funding at a post-money valuation of $2.6 billion is a testament to the growing demand for AI-powered coding assistants and the company’s rapid revenue growth. As the market continues to evolve, it will be interesting to see how Anysphere and its competitors continue to innovate and expand their offerings.

Related Articles

Nvidia Releases Its Own Brand of World Models: Nvidia has released its own brand of world models, which are AI-powered tools designed to simulate real-world environments.
Google is Forming a New Team to Build AI that Can Simulate the Physical World: Google is forming a new team to build AI that can simulate the physical world, with potential applications in fields such as robotics and computer vision.

Subscribe to TechCrunch for More Exclusive Content

Stay up-to-date with the latest news and insights on startups, venture capital, and technology by subscribing to TechCrunch. Our expert reporters provide in-depth coverage of the most significant developments in the industry.