In a major move to strengthen its AI development arm, Google has announced the hiring of Varun Mohan, co-founder and CEO of the AI coding startup Windsurf, along with other senior team members. The deal, valued at $2.4 billion, underscores Google’s aggressive strategy in the ongoing AI talent war.
Rather than acquiring Windsurf outright, Google will take a nonexclusive license to certain Windsurf technologies. This enables Windsurf to continue licensing its solutions to other companies, ensuring its operational independence while still benefiting from the arrangement.
“We’re excited to welcome some top AI coding talent from Windsurf’s team to Google DeepMind to advance our work in agentic coding,” said a Google spokesperson.
The new hires will contribute to Google DeepMind’s work on agentic coding, a field where AI tools actively assist in writing and managing code. This step aligns with Google’s broader mission to make its Gemini AI platform more valuable for developers.
The news follows failed acquisition talks between Windsurf and OpenAI, which was reportedly negotiating a $3 billion deal. Though exclusivity had been agreed upon, the deal was never finalized, leaving the door open for Google’s move.
Douglas Chen, another Windsurf co-founder, will also join Google. Jeff Wang, previously the head of business at Windsurf, now serves as interim CEO and confirmed that most of the team will continue building the company’s enterprise AI coding tools.
Windsurf has surged in popularity thanks to its innovative approach to vibe coding—using AI to streamline code creation for both developers and non-coders. This has attracted significant attention and investment in the space, with competitors like Cursor also being considered by OpenAI.
This isn’t Google’s first time hiring top talent instead of acquiring entire startups. A similar strategy was seen with Character.AI last year. Meanwhile, other tech giants like Microsoft, Amazon, and Meta have made comparable moves, acquiring AI talent through deals with Adapt and Inflection and even bringing Scale AI’s founder Alexandr Wang on board.
With Microsoft reporting that AI now generates up to 30% of its code via agent mode in Visual Studio and Google’s latest Windsurf deal, the race to dominate AI-driven software development is heating up fast.
