ChatGPT maker OpenAI has been trying to acquire the popular AI coding platform Windsurf by offering them $3 billion for quite some time now. But now, a report by The Verge claims that the deal has fallen apart after OpenAI’s exclusivity period for its acquisition lapsed, allowing Windsurf to consider
In an interesting turn of events, Google’s DeepMind division has confirmed that it is now poaching Windsurf CEO Varun Mohan, co-founder Douglas Chen, along with a small group of staff. While Google isn’t buying a stake in Windsurf and has clarified that it won’t have any control over the company, as part of its deal, the tech giant is paying Windsurf $2.4 billion to get a nonexclusive license to some of its in-house developed technology.
In a statement to Fortune, a Google spokesperson said, “We’re excited to welcome some top AI coding talent from Windsurf’s team to Google DeepMind to advance our work in agentic coding.” Also, the AI startup’s remaining 250-person team will continue working in the company with Windsurf’s head of business – Jeff Wang, taking over as interim CEO. In a post on X, Wang told Windsurf’s customers that its enterprise-grade AI coding tools aren’t going anywhere.
With Google poaching top talent from Windsurf, the tech giant’s AI coding tools might get a significant boost. Like Anthropic, the company has been focusing more and more on developing AI coding applications to lure developers.
As for Windsurf, the company might lose some of its momentum as its top talent is now heading over to Google. When Meta acquired Scale AI, the AI startup lost some of its customers. A few months after Microsoft poached Inflection’s then-CEO, Mustafa Suleyman, the company announced that it no longer wanted to work on consumer-grade AI applications and was pivoting more towards enterprise customers.
The news comes as a huge setback to ChatGPT maker OpenAI, which, in the last few months, has been struggling to retain its employees from tech giants like Google and Meta. According to the Wall Street Journal, tensions between OpenAI and Microsoft are reaching their high point. While the Sam Altman-led company wants to loosen Microsoft’s grip over its AI technology and products, the ChatGPT developer still needs the Redmond-based tech giant’s blessing if it wants to become a for-profit company and go public.
With antitrust cases piling up against Meta, Apple and Google, big tech companies are playing it safe by poaching top talent instead of buying companies outright. This not only makes it cheaper and easier for them, but also attracts less attention from governments around the world. But Google isn’t the only tech giant using these stealthy tactics. In March last year, Microsoft did the same thing with Mustafa Suleyman, who previously headed Google’s DeepMind division to establish Inflection AI, the company behind the popular AI chatbot Pi.
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