Google purchased Windsurf's top personnel for $2.4 billion amid a new trend of "acquihires on steroids," bypassing standard antitrust regulations. As these transactions become more common, many startups struggle post-acquisition. Unlike previous examples, Windsurf's remnants were acquired shortly after by Cognition, ensuring survival for its remaining business and staff. Previous deals left other startups like Scale AI and Character.ai in dire circumstances, highlighting the unique outcome for Windsurf in the evolving landscape of Silicon Valley acquisitions.
A new type of deal has swept through Silicon Valley in the past year or so, driven by the AI boom and antitrust limitations.
Crucially, Big Tech is not technically acquiring these startups, so the deals are not subject to the same antitrust rules.
OpenAI planned to buy Windsurf for $3 billion. The deal fell apart, and instead, Google paid $2.4 billion to hire Windsurf cofounder Varun Mohan.
Windsurf's story took a different turn. Another AI startup, Cognition, quickly snapped up the Windsurf remnants.
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