Google Acquires AI Coding Agent Startup WindSurf for $2.4 Billion

[Financial News]  


Alphabet's Google has decided to collaborate with AI coding agent startup WindSurf as part of its efforts to expand its AI capabilities.

The Wall Street Journal (WSJ) reported on the 12th (local time), citing sources, that Google will pay $2.4 billion (approximately 3.3 trillion won) to WindSurf, securing the right to use the company's technology and hiring some employees, including the CEO. The technology usage rights are non-exclusive, allowing WindSurf to sell the technology to other clients.

This is not a traditional 'merger and acquisition (M&A)' but rather an 'acquihire.'

WindSurf was initially set to be acquired by OpenAI, but as negotiations stalled, Google seized the opportunity, sources said.

Alphabet plans to use WindSurf's technology while integrating some employees into the coding agent development work of the DeepMind division.

However, there is no equity acquisition typically associated with such collaborations.

Google does not receive any shares in WindSurf, and most employees remain with WindSurf.

WindSurf was expected to be sold to OpenAI just a few months ago. OpenAI proposed to buy it for $3 billion, and an agreement was reached.

However, Microsoft's objections to some parts of the contract between the two companies led to the collapse of the M&A plan.

OpenAI intended to monopolize WindSurf's technology, blocking Microsoft's access, which angered Microsoft and led to their interference.

An AI coding agent is a tool that uses AI to develop software on behalf of developers. AI generates and tests code, even finding bugs.

It can be considered a developer version of the so-called general-purpose AI (AGI) that works instead of humans.

dympna@fnnews.com Song Kyung-jae Reporter