Cursor canβt stop growing.
The startup behind the eponymous AI coding tool just completed its third funding round of 2025, this time raising $2.3 billion from the likes of Google, Nvidia, Accel, Coatue, and others. It started the year valued between $2 and $3 billion. After this latest capital infusion, itβs worth $29.3 billion.
So, what does $2.3B buy you these days?
Maybe independence from the big AI model companies, such as OpenAI and Anthropic. Itβs been paying them to access their models even as those companies have released their own coding tools, Codex and Claude Code, that threaten to undercut Cursor. But Cursor launched its own AI model, Composer, last month. And it wants to throw a big chunk of this funding to grow it.
So consider this the opening of a two-front war (albeit a complicated one in which one side is selling weapons to the other).
For months, weβve been debating Cursor v. Claude Code. And, of course, we have also noticed numerous partisans for Codex, Windsurf, Warp, Trae and others. Plus, there are new tools dropping all the time, like βself-improving AI IDEβ Dropstone, which launched this week.
The question is: Does last monthβs launch of Composer combined with this weekβs huge haul change more than just the business model for Cursorβwill it make the AI IDE even better? Or are there other things it should be focusing on?