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An AI coding tool called Cursor has done what most startups only dream of — attracting more than one million users without any marketing budget, driven purely by word of mouth.
Cursor, developed by a small 60-person startup called Anysphere, is rapidly becoming one of the most widely discussed tools in software development. Designed to streamline the coding process, Cursor functions as a superpowered sidekick. “It just makes a thing that you do every day better and faster,” said Oskar Schulz, Anysphere’s president, as reported by Bloomberg.
What makes Cursor click?
Cursor operates similarly to ChatGPT but is specifically for coding. It integrates seamlessly with Visual Studio Code and functions as a collaborative co-pilot. It can complete code, respond to queries, suggest fixes, and even detect bugs proactively. The tool is powered by several advanced AI models, including those from OpenAI and Anthropic, as well as its own proprietary systems.
Developers describe the tool as intuitive and context-aware, enabling them to focus on the creative aspects of software development. Some users even refer to it as a source of “creative momentum.”
Daniel Destefanis, a product designer using Cursor to build an iOS app, said the tool is managing the majority of the coding work. “It just lets me focus on the fun part, the design part, and handles the stuff that I either don’t have the skill set for or it would just take me too long,” he is quoted as saying in the Bloomberg article.
However, Cursor is not without limitations. One developer reported that Cursor stopped generating code for a racing game after 800 lines, issuing a message: “I cannot generate code for you… you should develop the logic yourself.”
Cursor’s revenue has already doubled in 2025
Despite its team of just 60 people, Anysphere has transformed Cursor into a major revenue generator. In January 2025, the company reached $100 million in annual recurring revenue; by March 2025, that figure had doubled. The majority of this revenue comes from individual users subscribing at $20 per month for a Pro account or $40 per month for a business plan.
Schulz noted to Bloomberg that more than 14,000 businesses are now paying customers. That number is expected to increase as Anysphere begins expanding its enterprise sales team and scaling operations.
Investors include an OpenAI cofounder
With buzz like this, investors are taking notice. Anysphere has already raised $175 million from backers including Andreessen Horowitz and Thrive Capital, as well as AI pioneers who include OpenAI cofounder John Schulman (now at Thinking Machines Lab) and Google DeepMind’s Jeff Dean. The company is reportedly in talks to raise additional funding at a valuation approaching $10 billion.
Cursor’s challenges and main strength
With rapid growth often comes more challenges, such as increasing cloud computing costs and intensifying competition from the same AI giants that Cursor relies on, including OpenAI and Anthropic.
Still, CEO Michael Truell stated the company’s strength lies in its focus. “We’re less interested in things that are completely automated end-to-end,” he said. “We want to give humans much more control.”
Will AI replace developers’ jobs? This eWeek article details what IBM and Anthropic leaders think.