{"id":3165,"date":"2025-07-12T02:59:03","date_gmt":"2025-07-12T02:59:03","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/3165\/"},"modified":"2025-07-12T02:59:03","modified_gmt":"2025-07-12T02:59:03","slug":"windsurfs-ceo-goes-to-google-openais-acquisition-falls-apart","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/3165\/","title":{"rendered":"Windsurf’s CEO goes to Google; OpenAI’s acquisition falls apart"},"content":{"rendered":"

OpenAI\u2019s deal to acquire<\/a> the viral AI coding startup Windsurf for $3 billion fell apart on Friday<\/a>, according to The Verge.<\/p>\n

In a shocking twist, Google DeepMind is now hiring Windsurf CEO Varun Mohan, co-founder Douglas Chen, and some of the startup\u2019s top researchers. A Google spokesperson confirmed the hiring of Windsurf\u2019s leaders in a statement to TechCrunch.<\/p>\n

Notably, Google is not taking a stake in Windsurf and will not have any control over the company. However, as part of the deal, Google will have a nonexclusive license to certain Windsurf technology, meaning the AI coding startup remains free to license its technology to others. <\/p>\n

Bloomberg reports that Google is paying $2.4 billion<\/a> to license Windsurf\u2019s technology and hire its top employees.<\/p>\n

\u201cWe\u2019re excited to welcome some top AI coding talent from Windsurf\u2019s team to Google DeepMind to advance our work in agentic coding,\u201d said Google spokesperson Chris Pappas in an email to TechCrunch.<\/p>\n

The deal represents the AI ecosystem\u2019s latest reverse-acquihire, in which a company hires a startup\u2019s top talent and licenses its technology but does not outright acquire the company. Google previously conducted a similar deal to hire back Character.AI CEO Noam Shazeer<\/a>, as did Microsoft to hire Mustafa Suleyman<\/a>. These deals have helped several Big Tech companies increase their position in the AI race without drawing regulatory scrutiny.<\/p>\n

\u201cWe are excited to be joining Google DeepMind along with some of the Windsurf team,\u201d said Mohan and Chen in a statement to TechCrunch. \u201cWe are proud of what Windsurf has built over the last four years and are excited to see it move forward with their world class team and kick-start the next phase.\u201d<\/p>\n

As of Friday, Windsurf\u2019s head of business, Jeff Wang, will take over as the startup\u2019s interim CEO, he announced in a post on social media<\/a>. Most of Windsurf\u2019s 250 person team is not headed to Google DeepMind and will continue offering its AI coding tools for enterprise customers.<\/p>\n

Big welcome to @_mohansolo<\/a> and others from the Windsurf team joining Deepmind : )<\/p>\n

\u2014 Logan Kilpatrick (@OfficialLoganK) July 11, 2025<\/a><\/p>\n

OpenAI\u2019s deal to acquire Windsurf has reportedly been a major tension point in the ChatGPT maker\u2019s contract renegotiations with Microsoft. Microsoft currently has access to all of OpenAI\u2019s intellectual property; however, OpenAI didn\u2019t want its largest backer to get Windsurf\u2019s AI coding technology as well, according to previous reporting from the Wall Street Journal<\/a>.<\/p>\n

Earlier on Friday, Fortune reported that the exclusivity period on OpenAI\u2019s offer to acquire Windsurf had expired<\/a>, meaning that Windsurf would now be free to explore other offers. It seems that Windsurf didn\u2019t wait long.<\/p>\n

In recent months, Windsurf has been one of the hottest AI coding startups on the market. In April, the startup\u2019s ARR reached about $100 million<\/a>, TechCrunch previously reported, up from about $40 million months earlier. That rapid growth attracted suitors such as OpenAI and apparently Google.<\/p>\n

The addition of Mohan, Chen, and other Windsurf leaders could significantly boost Google\u2019s ability to build AI coding tools. In recent months, AI model providers have focused more on offering AI coding applications to entice developers. Anthropic has boosted its revenue significantly on the back of its AI coding tool, Claude Code<\/a>, while OpenAI continues to pitch Codex, its AI coding agent, to software engineers.<\/p>\n

Windsurf, on the other hand, is left in a much more uncertain position as a result of this deal. Other AI startups that have seen their leaders hired away have struggled to sustain the same momentum they had beforehand. Scale AI lost customers as a result of its deal with Meta<\/a>, whereas Inflection had to pivot entirely from consumer AI<\/a> after its deal with Microsoft.<\/p>\n

It seems likely that Windsurf could suffer a similar fate.<\/p>\n

Update 7:25 pm PT: This article was updated to include the reported price Google paid Windsurf in the deal.<\/p>\n