Google has struck a licensing deal with AI coding startup Windsurf, blocking OpenAI’s $3 billion acquisition attempt.
The exclusivity period on OpenAI’s offer expired, freeing Windsurf to pursue other options.
Under the deal, Windsurf will remain independent, but some of its top team members will join Google DeepMind.
“We’re excited to welcome some top AI coding talent from Windsurf’s team to Google DeepMind,” a Google spokesperson told Fortune.
Windsurf’s founders, Varun Mohan and Douglas Chen, added, “We are excited to be joining Google DeepMind along with some of the Windsurf team.”
The move is a blow to OpenAI, which has recently faced talent losses to rivals like Meta.talent losses to rivals like Meta.
A spokesperson confirmed that its exclusivity agreement with Windsurf—signed in May—had ended.
Founded in 2021 by MIT graduates, Windsurf began as Codeium before rebranding in April.
Its backers include Founders Fund, General Catalyst, Greenoaks, and Kleiner Perkins.
In February, TechCrunch reported that Windsurf was raising funds at a $2.85 billion valuation.
AI coding startups are a booming segment of the tech market.
Microsoft’s GitHub Copilot, built on OpenAI’s models, is now widely used.
Meanwhile, rival Cursor, backed by Thrive Capital and Andreessen Horowitz, raised $900 million at a $9 billion valuation.
Before bidding for Windsurf, OpenAI also approached Anysphere, maker of Cursor.
But the company reportedly declined acquisition talks—“even by OpenAI,” according to TechCrunch.
With the Windsurf team split, Google gains valuable talent while Windsurf continues to build independently.
The deal adds momentum to Google DeepMind’s push into agentic coding, where AI not only writes code but executes tasks autonomously.
