Codeium (Windsurf)

What it is

Windsurf is an agentic IDE — an integrated development environment built around AI agents that carry out coding work, rather than only suggesting the next line as a completion tool does. A developer hands the tool a task, such as fixing a failing test or adding a feature, and the agent works through the steps itself. The product was formerly known as Codeium, and as late as February 2025 the company itself was still called Codeium ^[1]. Its co-founders are Varun Mohan and Douglas Chen ^[1].

Early funding

Greenoaks led both the seed round and the Series A and owned 20% of the company ^[1]. By its last round in 2024, the company had raised about $243 million at a valuation of $1.25 billion ^[1]. In February 2025, Kleiner Perkins was in talks to lead a round that would have valued the company at $2.85 billion ^[1]. That round did not happen, because the company had instead agreed to be purchased by OpenAI for $3 billion ^[1].

The Google deal

The transaction that followed had a different shape. Google paid Windsurf $2.4 billion to license its technology while hiring its chief executive and top talent ^[1]. The sum was split into two roughly equal parts: $1.2 billion for investors and $1.2 billion in compensation for about 40 employees ^[1]. The company had approximately 250 employees, of whom about 200 were not hired by Google ^[1]. A licence-plus-hiring arrangement transfers the technology and the people the buyer wants, while the corporate entity and most of its staff stay outside the buyer.

Acquisition by Cognition

On 14 July 2025, Cognition signed a definitive agreement to acquire Windsurf, including its intellectual property, product, trademark and brand ^[2]. Cognition said the acquired business had $82 million of annual recurring revenue — the subscription revenue a business expects to repeat over a year — with enterprise ARR doubling quarter over quarter ^[2]. It also reported more than 350 enterprise customers and hundreds of thousands of daily active users ^[2]. On the staff side, Cognition said all Windsurf employees would participate financially in the deal, have vesting cliffs waived and receive fully accelerated vesting ^[2]. Those terms matter because equity normally vests over time and unvested portions are often forfeited when a company changes hands; waiving the cliff and accelerating vesting means employees receive their full allocation immediately rather than on the original schedule.

What the sequence shows

The company's history packs several kinds of AI deal into a short span: a venture-funded ascent to a $1.25 billion valuation in 2024, talks that would have valued it at $2.85 billion, a $3 billion agreement to be bought by OpenAI that did not end with OpenAI owning the company, a $2.4 billion licence-and-hiring arrangement with Google, and finally an acquisition by Cognition ^[1][2]. For a company whose product is a coding tool, the value being contested sat both in the software and in the people who built it.