Cursor, the AI-powered coding tool, has secured a $2.3 billion funding round that values the company at $29.3 billion, more than doubling its previous valuation of $9.9 billion from a June 2024 Series C round. The latest investment, led by Accel and new backer Coatue, with strategic participation from Nvidia and Google, underscores growing confidence in Cursor’s position within the fast-evolving AI development tools market. Thrive Capital, which led Cursor’s earlier funding rounds, also joined this round, maintaining its long-term support for the company. The surge in valuation comes amid a period of explosive growth, with Cursor’s enterprise revenue increasing 100 times year-to-date in 2025. The company is increasingly adopted by professional developers who value its speed, accuracy, and ability to generate secure, scalable code. This growth reflects a broader shift in software development, where AI is no longer a novelty but a core component of the engineering workflow. Cursor’s product is built around an AI-first coding environment that integrates deeply with developer workflows. While it currently relies on external AI models from providers like OpenAI, Google, and Anthropic to power its features, the company is advancing its own AI model, Composer, which was launched in October. The new funding will be directed toward accelerating the development and deployment of Composer, aiming to reduce dependency on third-party models and enhance performance, customization, and data privacy. The strategic involvement of Nvidia and Google highlights the importance of ecosystem partnerships in the AI space. Nvidia, a major enterprise customer, benefits from Cursor’s growing adoption of its hardware and AI infrastructure. Google, as a supplier of foundational AI models, gains a strategic foothold in the developer tools market, where its models are used to power key features. These relationships not only validate Cursor’s technology but also position it as a key player in the AI software stack. The competitive landscape for AI coding tools is intensifying. OpenAI and Anthropic are both expanding their offerings in developer tools, with new features and models designed to rival Cursor’s capabilities. As the market matures, the race is no longer just about speed or accuracy, but also about integration, security, and long-term sustainability. Cursor’s ability to scale enterprise adoption while investing in proprietary AI technology like Composer will be critical to maintaining its edge. Despite its rapid growth, Cursor faces challenges. The AI coding space is crowded, with established players like GitHub Copilot and emerging startups vying for developer attention. Additionally, concerns around data privacy, model transparency, and the long-term impact of AI on software jobs continue to shape the market. Nonetheless, Cursor’s trajectory remains strong. The company is not just a tool for writing code—it’s becoming a platform for redefining how software is built. With a $29.3 billion valuation, a 100x growth in enterprise revenue, and a clear path toward self-sufficiency through its in-house AI model, Cursor is positioning itself as a leader in the next generation of software development. The coming year will be pivotal. As AI coding tools become more central to engineering teams, the companies that can deliver reliable, secure, and innovative solutions will win. For Cursor, the next phase is not just about growth—it’s about proving that its vision of an AI-native development environment can scale across industries and teams. With strong backing, a clear product roadmap, and a growing user base, Cursor is well on its way to becoming a cornerstone of the future of software.