Anysphere Raises $100M Series B Funding for AI-Powered Coding Assistant

Anysphere, the company behind the AI-powered coding assistant Cursor, has secured a $100 million Series B funding round at a post-money valuation of $2.6 billion. The round was led by returning investor Thrive Capital, with a16z also participating in the investment. This new funding comes on the heels of Anysphere's $60 million Series A round just four months ago, which valued the company at $400 million.

Despite interest from other investors like Index Ventures and Benchmark, Anysphere's rapid growth led existing VCs to double down on their bet, resulting in a significant 6.5 times leap in valuation. The market for AI-powered coding assistants is competitive, with options like Augment, Codeium, Magic, and Poolside vying for developer attention.

However, Cursor has emerged as a popular choice, especially as it competes with Microsoft's GitHub Copilot. Anysphere's revenue has skyrocketed from $4 million annualized recurring revenue (ARR) in April to $4 million a month in October, indicating an ARR of $48 million in October.

The company operates on a freemium model with tiered pricing, attracting customers like OpenAI, Midjourney, Perplexity, Replicate, Shopify, and Instacart. Founded in 2022 by Michael Truell, Sualeh Asif, Arvid Lunnemark, and Aman Sanger at MIT, Anysphere has garnered support from notable investors, including Neo, Patrick Collison, Nat Friedman, and Arash Ferdowsi. The company also underwent OpenAI's accelerator program and received seed funding from OpenAI Startup Fund.

Source: Tech Crunch