I am a bit removed from this action but it seems that Google got screwed. $2.4bn for "brains" and now they still have to pay license fees for Windsurf that is now owned by an independent company with all their staff. That's where the real IP is!
It's funny how most people, especially in the Bay Area, worship the leaders of companies that are publicly visible. I am afraid those two (or more?) guys are worthless for Google.
I think what people and analysts will realize in two years is that such acquisitions are wroth $0 and will be part of the intangible assets :-) AI is at its very early innings and code gen and other power use cases are not at all mature -not to mention that the agent tech does not work yet (read research papers on the topic). If Google wanted to fill a gap in their offering, they should have bought the whole IP and team to do so. Instead, they got the crumbs.
My guess is that Windsurf probably played them against each other when they negotiated the deal and they saw that OpenAI got out, they fell for it. On paper, it looks like a great win from the Google VC arm: "boss, you got them, we beat OpenAI and Microsoft!". Until the 22 hour and act 3 of this drama.
On a side note, just wanted to say thank you for sharing your wisdom and analysis on those topics. I got to follow you recently on LinkedIn and you are one of the few individuals that delivers value i every post!
Appreciate the kind words - and your take raises a very real tension at the heart of these deals.
I can see why it looks like Google got played. But a full acquisition may never have been on the table. With Windsurf’s enterprise traction and Google’s existing dev stack, a takeover would’ve drawn real regulatory scrutiny - especially from the FTC and EU, where AI consolidation is under the microscope. So Google played within the bounds: licensed the IP, hired the minds, and avoided antitrust fire. IP is no longer just code - it’s people, momentum, and belief in a worldview.
Cognition, unburdened by Big Tech optics, had the runway to do a full acquisition - team, product, and brand.
And you're right - agentic code gen is still raw. But that’s also why these bets are happening now. Nobody wants to be the last one holding a checkbook when the platforms shake out.
Nice article, very well written. Do you see this trend continuing particularly in the AI infra and platforms space where the big players want to dominate?
Crazy moves by big players indeed!
I am a bit removed from this action but it seems that Google got screwed. $2.4bn for "brains" and now they still have to pay license fees for Windsurf that is now owned by an independent company with all their staff. That's where the real IP is!
It's funny how most people, especially in the Bay Area, worship the leaders of companies that are publicly visible. I am afraid those two (or more?) guys are worthless for Google.
I think what people and analysts will realize in two years is that such acquisitions are wroth $0 and will be part of the intangible assets :-) AI is at its very early innings and code gen and other power use cases are not at all mature -not to mention that the agent tech does not work yet (read research papers on the topic). If Google wanted to fill a gap in their offering, they should have bought the whole IP and team to do so. Instead, they got the crumbs.
My guess is that Windsurf probably played them against each other when they negotiated the deal and they saw that OpenAI got out, they fell for it. On paper, it looks like a great win from the Google VC arm: "boss, you got them, we beat OpenAI and Microsoft!". Until the 22 hour and act 3 of this drama.
On a side note, just wanted to say thank you for sharing your wisdom and analysis on those topics. I got to follow you recently on LinkedIn and you are one of the few individuals that delivers value i every post!
Appreciate the kind words - and your take raises a very real tension at the heart of these deals.
I can see why it looks like Google got played. But a full acquisition may never have been on the table. With Windsurf’s enterprise traction and Google’s existing dev stack, a takeover would’ve drawn real regulatory scrutiny - especially from the FTC and EU, where AI consolidation is under the microscope. So Google played within the bounds: licensed the IP, hired the minds, and avoided antitrust fire. IP is no longer just code - it’s people, momentum, and belief in a worldview.
Cognition, unburdened by Big Tech optics, had the runway to do a full acquisition - team, product, and brand.
And you're right - agentic code gen is still raw. But that’s also why these bets are happening now. Nobody wants to be the last one holding a checkbook when the platforms shake out.
Appreciate you following along - truly.
Nice article, very well written. Do you see this trend continuing particularly in the AI infra and platforms space where the big players want to dominate?