SpaceX announced it has secured an option to acquire the code-generation startup Cursor for $60 billion later this year, or alternatively pay $10 billion for their new partnership, as it ventures further into the lucrative market for AI developer tools.
Alongside OpenAI and Anthropic, Cursor is among several Silicon Valley startups that have attracted waves of developers by utilizing artificial intelligence to automate coding, a business area where AI companies have found early commercial success.
This deal could provide xAI, the Grok chatbot creator which SpaceX integrated with in February, a stronger position in the AI coding market, where it has so far trailed behind competitors. It also gives Cursor increased computing capacity to develop AI models.
“The combination of Cursor’s leading product and distribution to expert software engineers with SpaceX’s million H100 equivalent Colossus training supercomputer will enable us to build the world’s most useful models,” SpaceX stated in a social media post on Tuesday.
Colossus is xAI’s supercomputer cluster in Memphis, which it has promoted as the largest in the world. The company has been investing billions of dollars in AI infrastructure.
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The announcement comes ahead of SpaceX’s highly anticipated public listing in the upcoming months, with the company aiming for a valuation close to $1.75 trillion and a $75 billion fundraise, potentially marking the largest IPO in history.
Two heads of product engineering at Cursor, a startup that provides AI models for coding tasks, said in March they joined SpaceX to contribute to the company’s lunar projects and xAI, Musk’s AI startup, which is now part of SpaceX.
Musk welcomed the engineers, Andrew Milich and Jason Ginsberg, saying, “Orbital space centers and mass drivers on the Moon will be incredible.”
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