Google Snaps Up AI Talent from Windsurf as OpenAI’s Acquisition Talks Collapse

Google has secured a licensing agreement with AI coding startup Windsurf, ending OpenAI’s attempt to acquire the company. The deal allows Windsurf to continue operating independently, while several team members move to Google DeepMind to support its work in developing AI tools for software development.

A Google spokesperson confirmed the news, stating that the company is welcoming some of the top AI coding talent from Windsurf to DeepMind. Windsurf’s co-founders, Varun Mohan and Douglas Chen, also said they are excited to join Google with part of their team.

OpenAI had entered into an exclusivity agreement with Windsurf in May as part of a proposed three billion dollar acquisition. However, the agreement expired before both parties could reach a final deal, allowing Windsurf to explore other opportunities. OpenAI acknowledged the end of the exclusivity period in a statement.

Windsurf, which launched in 2021 under the name Codeium, rebranded earlier this year. The startup was founded by MIT alumni and has attracted investment from firms such as Founders Fund, General Catalyst, Greenoaks, and Kleiner Perkins. Earlier reports suggested that Windsurf was raising funds at a valuation of two point eight five billion dollars.

The deal highlights the growing momentum in the AI coding space. GitHub Copilot, developed by Microsoft using OpenAI models, has already seen wide adoption. Meanwhile, other startups in the sector are attracting major investment. Cursor, a competing platform, recently raised nine hundred million dollars in a Series C round, reaching a valuation of nine billion dollars. OpenAI also held acquisition talks with Cursor, but the startup chose to remain independent.