Anysphere, the two-year-old startup that built the AI-powered coding assistant Cursor, has raised more than $60 million in Series A funding, bringing its post-money valuation to $400 million, two sources familiar with the deal told TechCrunch.
The round was co-led by Andreessen Horowitz and Thrive Capital, with Stripe co-founder and CEO Patrick Collison also participating.
Anysphere, a16z and Collison did not respond to requests for comment. Thrive declined to comment.
The company was co-founded by Michael Truell, Suare Asif, Arvid Runemark, and Aman Sanger while at MIT. Truell and Sanger later participated in Neo Scholars, a prestigious mentorship program for undergraduates majoring in technology fields. Neo, which also runs an accelerator and venture fund, led Anysphere's pre-seed investment. Last year, the company raised $11 million in a seed round led by OpenAI Startup Fund and joined by former GitHub CEO Nat Friedman, Dropbox co-founder Arash Ferdowsi, and other angel investors.
Anysphere is part of an increasingly competitive field of AI coding copilot startups: Other startups looking to make software creation more efficient include Cognition, Poolside, Magic and Augment.
Investors' interest in the space isn't surprising: During an earnings call last month, Microsoft CEO Satya Nadella said revenue from GitHub Copilot, an AI-powered tool that helps developers write code faster and more efficiently, was “already larger than the entirety of GitHub at the time of the acquisition.” GitHub's revenue was reportedly estimated at $300 million when the tech giant agreed to acquire the software development platform for $7.5 billion in 2018.
That means roughly 30 million developers around the world are paying Microsoft $100 a year (about the cost of a yearly GitHub subscription) to become more productive programmers, estimates a venture capitalist who invests in coding startups. “When you have that much demand, it creates a lot of competition,” he said.
Anysphere's revenue and usage are also growing rapidly, one person said.
In July, Business Insider reported that Anysphere was in the process of raising new funding and was seeking a valuation of $400 million.
Want to share a tip? Email me at marina.temkin@techcrunch.com or message me on Signal at 347.683.3909. You can also message the entire TechCrunch staff at tips@techcrunch.com. If you'd like to communicate more securely, click here to get in touch. We've included links to SecureDrop (instructions here) and other encrypted messaging apps.