The transaction would be the largest technology acquisition in history.
Cursor's $60B sale to SpaceX/xAI is the largest tech acquisition in history.
Yet on revenue multiple it's actually a *cheap* deal — and it makes strategic sense for both sides.
A thread, with the numbers 🧵👇
Users see the SpaceX and xAI acquisition of Cursor as attractive because of the startup's rapid revenue doubling that improves the deal's valuation on a PEG basis.
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The Fable saga made Cursor far more attractive: less lock-in, model flexibility, open-source options.
Est. gross returns at $60B: Thrive ~150×, a16z ~150×, Accel & DST ~6.7×.
Heads scratched in April: many vibe-coders had jumped to Claude Code.
But revenue kept compounding. At ~$4B ARR, Cursor runs several times ahead of its nearest independent rival — and miles past everyone else.
~15× on today's ~$4B revenue, falling toward ~10× as this year's revenue lands.
That's less than half the median multiple paid in major AI M&A — and Cursor is the fastest grower of the lot.
Yesterday Cursor unveiled an in-house 1.5T-param model, pre-trained on 100k+ GPUs — "as big as Opus and GPT."
It now has one of the best-positioned compute clusters anywhere. The very nature of "lines of code" is about to change.
It looks even better when you do on a PEG ration-equivalent basis! Cursor doubled revenue in just two months ($2B -> $4B), and that was when they were using 3rd party models mostly. Their new model is going to enable them to significantly accelerate revenue growth and increase margin - at the same time.
