Cognition eyes $40 billion valuation in funding talks

Cognition AI has opened preliminary discussions with investors over a fresh capital raise that could value the fast-growing artificial intelligence coding company at at least $40 billion, marking another sharp escalation in investor expectations for autonomous software development tools.

The talks remain at an early stage and the size, valuation and investor line-up could change before any transaction is completed. A $40 billion valuation would nevertheless represent an increase of more than 50% from the roughly $26 billion level established when Cognition raised more than $1 billion in May.

The potential financing comes less than three months after that fundraising, illustrating the pace at which capital is flowing into companies developing AI agents capable of performing increasingly complex programming tasks. Cognition’s previous round was led by Lux Capital, General Catalyst and 8VC and followed a $400 million financing completed in 2025 at a $10.2 billion post-money valuation.

Cognition, founded by Scott Wu, Steven Hao and Walden Yan, develops Devin, an autonomous software engineering agent designed to plan and execute coding projects with limited human intervention. The company has positioned the technology as a system that allows engineers to supervise multiple AI agents while concentrating on architecture, product decisions and complex problem-solving.

Growth in enterprise usage has helped propel Cognition’s valuation. When announcing its May financing, the company said its revenue run rate had reached $492 million and enterprise usage of Devin had expanded by about 50% month-on-month for six consecutive months. Its customers include Goldman Sachs, Mercedes-Benz, Santander and NASA, alongside other large organisations deploying AI tools across engineering workflows.

The expansion has been accelerated by Cognition’s acquisition of Windsurf, the AI-powered integrated development environment that became the centre of an intense contest among leading technology companies last year. Cognition agreed to acquire Windsurf’s product, intellectual property, trademark, brand and much of its remaining workforce in July 2025.

That agreement followed Google’s $2.4 billion arrangement to hire Windsurf co-founder and chief executive Varun Mohan, co-founder Douglas Chen and several research employees while securing technology licensing rights. Windsurf had previously held acquisition discussions with OpenAI over a transaction potentially worth about $3 billion.

Before those developments, Windsurf had built annualised revenue of about $82 million and accumulated more than 350 enterprise customers. Combining Windsurf’s developer environment with Devin gave Cognition a broader position in the software development chain, spanning interactive coding tools and autonomous agents capable of completing longer-running assignments.

Competition in the sector has intensified as software creation becomes one of the most commercially significant applications for generative AI. Anthropic has expanded Claude Code, OpenAI has developed increasingly agentic coding capabilities, Microsoft continues to build GitHub Copilot into a broader development platform, while Anysphere’s Cursor has emerged as a major independent competitor. Stockholm-based Lovable, focused on building software through natural-language instructions, has also attracted substantial capital and reached a valuation above $13 billion.

The rapid rise of these companies reflects an investor thesis that programming represents an unusually attractive market for AI because coding tasks can often be measured, tested and corrected automatically. Software agents can write code, inspect repositories, identify errors, run tests and revise their work, making it possible to quantify improvements more directly than with many consumer AI applications.

Cognition has sought to move Devin beyond the conventional coding-assistant model. Rather than limiting the software to predicting code or answering programming questions, the company wants its agents to perform sequences of tasks independently, including navigating large codebases, resolving engineering tickets and implementing features.

Chief executive Scott Wu has argued that the longer-term shift will change the role of human developers rather than simply automate individual programming functions. Cognition describes a model in which engineers increasingly operate as architects, defining problems and directing groups of agents that handle much of the execution.