Cognition received a valuation offer of up to $80 billion, yet its annual revenue is only roughly a quarter of Cursor’s.

Insight Beating AI Flash News: AI coding firm Cognition has received a new round of financing offers, with investors valuing it at $70 billion to $80 billion, even exceeding the $60 billion implied equity valuation when SpaceX acquired Cursor. On September 8, Cognition just raised over $2 billion at a $48 billion valuation. In just seven weeks, the highest offer has increased by 67%. The company is considering another financing round before the end of the year, but nothing has been finalized yet. Cognition’s core product Devin has evolved from assisting in code writing to independently executing software engineering tasks. After acquiring Windsurf last year, it added an AI code editor and enterprise sales channels. At the time of acquisition, Windsurf already had over 350 enterprise clients. Cognition’s annualized revenue grew from $492 million in May this year to over $1 billion in September, with clients including NVIDIA, Citigroup, and Mercedes-Benz. However, compared to Cursor, its valuation is still higher. Cursor’s annualized revenue reached around $4 billion in June, nearly four times that of Cognition, yet Cognition’s current offer is higher. Based on a rough calculation of $1 billion annualized revenue, its valuation equals 70 to 80 times revenue. Moreover, after SpaceX acquired Cursor, it can use SpaceX’s GPU cluster; Cognition, by contrast, spends hundreds of millions of dollars annually renting NVIDIA servers and training its own programming models on open-source models, with cash burn possibly reaching $800 million this year. Insiders said that excluding investment in self-developed models, Cognition’s free cash flow is nearly breaking even, and this investment is precisely its way to reduce reliance on OpenAI and Anthropic models.