Google Cloud is gaining momentum in the competitive cloud market, fueled in part by a growing number of fast-rising AI startups choosing its platform as their primary infrastructure provider. On Thursday, the company announced that two prominent AI coding startups, Lovable and Windsurf—recently acquired by Cognition—are now using Google Cloud as their main cloud computing provider. This move underscores Google’s expanding role in the AI ecosystem and its strategy to position cloud computing as a core pillar of its future growth. While Google Cloud still trails behind industry leaders AWS and Microsoft Azure, and remains overshadowed by Google’s dominant advertising business, it is experiencing strong upward trends. In its most recent earnings report, Google revealed that its cloud division reached an annual run rate of $50 billion, with cloud chief Thomas Kurian projecting $58 billion in new revenue over the next two years. The division generated $43.2 billion in cloud services revenue in 2024, up from $33.1 billion in 2023. A key driver of this growth is Google’s success in attracting AI startups. The company now works with nine of the top 10 AI labs, including OpenAI and Safe Superintelligence, and claims to serve 60% of the world’s generative AI startups. Over the past year, Google Cloud has seen a 20% increase in the number of new AI startups selecting its platform. Although startups like Lovable and Windsurf may not yet spend heavily compared to large enterprises or major AI labs, Google views them as high-potential future clients. Both companies use Gemini 2.5 Pro to power their products and run their operations on Google Cloud infrastructure. Windsurf also integrates Gemini models into its work with Cognition’s AI agent, Devin. The rising costs of training, fine-tuning, and deploying AI models have created a significant demand for scalable cloud infrastructure. This has benefited cloud providers, with the global market expected to exceed $400 billion in 2025 and grow at a 20% annual rate over the next five years, according to Synergy Research. To strengthen its appeal, Google hosted its first Google AI Builder’s Forum on Thursday, bringing together hundreds of AI startup founders. The event unveiled more than 40 new startups building on Google Cloud, including Lovable and Windsurf, as well as Factory AI (backed by Sequoia Capital) and Krea AI (backed by Andreessen Horowitz). Google’s strategy includes generous incentives for startups. Many of its AI partners began through the Google for Startups Cloud Program, which provides up to $350,000 in cloud credits. Additionally, startups in the Y Combinator accelerator program gain access to dedicated clusters of Nvidia GPUs, giving them critical compute resources at an early stage. These programs are designed to build long-term loyalty and drive future revenue growth.