Google strikes $2.4B hack‑quisition for Windsurf

Google has struck a $2.4 billion ‘hack‑quisition’ for Windsurf, the four‑year‑old AI coding‑assistant company formerly called Codeium. Instead of buying the startup outright, Google DeepMind will hire CEO Varun Mohan, co‑founder Douglas Chen and dozens of top engineers, while paying Windsurf a non‑exclusive licence for its code‑generation IP. The payment will be split between investors and the group joining Google; Kleiner Perkins is expected to triple its $100 million Series B, and early backer Greenoaks, owning ~20 %, will profit. Employees with unvested equity—many hired in the past year—get nothing.

Hundreds of remaining staff will stay at Windsurf, which keeps roughly $100 million in cash and will now be led by business chief Jeff Wang. The agreement surfaced after OpenAI’s tentative $3 billion acquisition collapsed over fears Microsoft would gain Windsurf IP via its pact with OpenAI. The licensing deal does not give Google equity, only access and people.

Google’s move echoes other mega‑licence talent grabs, including its $2.7 billion Character AI deal and Microsoft’s $650 million Inflection arrangement, letting Big Tech scoop AI talent quickly without antitrust headaches. Windsurf’s incoming DeepMind team will focus on “agentic” coding tools, strengthening Google’s position against Cursor, Scale AI and other fast‑growing rivals.