AI coding assistant Cursor has announced its acquisition of Graphite, a startup specializing in AI-driven code review and debugging.
While the financial terms of the agreement were not disclosed, Axios reported that Cursor’s payment significantly surpassed Graphite’s most recent valuation of $290 million, which was established earlier this year when the five-year-old company secured $52 million in Series B funding.
This integration represents a strategic advantage. AI-generated code frequently contains errors, obliging engineers to dedicate substantial time to corrections. Although Cursor already offers AI-powered code review via its Bugbot product, Graphite’s specialized toolset features a unique “stacked pull request” capability, allowing developers to manage multiple interdependent changes simultaneously without needing to wait for individual approvals.
The combination of AI-powered code generation with AI-enhanced code review tools streamlines the entire process, from initial code drafting to final deployment.
Other notable startups in the AI-powered code review sector include CodeRabbit, which reached a valuation of $550 million in September, and Greptile, a smaller competitor that recently announced a $25 million Series A funding round this fall.
Michael Truell, Cursor’s co-founder and CEO, first met Graphite’s co-founders, Merrill Lutsky, Greg Foster, and Tomas Reimers, prior to launching his company, during his participation in the Neo Scholar program—a prestigious initiative for college students operated by Neo, Ali Partovi’s early-stage venture firm. PitchBook data indicates that Neo provided seed funding for Graphite.
Furthermore, both Cursor and Graphite share several investors, including Accel and Andreessen Horowitz.
Cursor, which achieved a valuation of $29 billion in November, has been actively pursuing acquisitions. Last month, it acquired Growth by Design, a company focused on tech recruiting strategy. In July, Cursor also integrated the talent from AI-powered CRM startup Koala, a deal reportedly valued at $129 million post-money, according to PitchBook.