Hey there, tech enthusiasts! Today, we’re diving into an exciting development in the world of AI coding assistants.

Investor interest in AI coding tools is skyrocketing! Anysphere, known for its AI-powered coding assistant named Cursor, is currently in discussions with venture capitalists to secure funding that could elevate its valuation to a staggering $10 billion.

This potential funding round, as reported by Bloomberg, follows Anysphere’s successful capital raise of $100 million just three months earlier, wherein it was valued at $2.5 billion.

Returning investor Thrive Capital is anticipated to lead this latest investment round, demonstrating confidence in Anysphere’s growth trajectory. Despite this, neither Thrive Capital nor Anysphere has commented on the matter yet.

While Anysphere’s previous funding pegged the company at 25 times its annual recurring revenue (ARR) of $4 million, it appears investors are now valuing fast-growing firms even higher. They estimate that Anysphere’s ARR has surged to $150 million, theoretically justifying the new evaluation at 66 times its ARR.

Moreover, the trend doesn’t stop at Anysphere. Another player in the field, Codeium, which is launching an AI coding editor called Windsurf, is reportedly in talks to raise funds at a valuation close to $3 billion.

Industry experts observe that AI is evolving rapidly in coding solutions, outpacing its advancements in various other sectors like law and healthcare. There’s a rising interest from investors in companies like Poolside, which is also working on its AI solutions.

As the AI coding sector thrives, it’s clear that these developments will significantly shape the tech landscape in the coming years.