Cognition AI, maker of Devin, raises $400 million at $10.2 billion valuation
Cognition AI, the fast-rising startup behind the AI coding agent Devin, has surged to a $10.2 billion valuation after securing a fresh $400 million funding round, according to Bloomberg. The deal represents a steep jump from the company’s $4 billion valuation earlier this year and signals investor confidence in the face of both fierce competition and internal challenges.
The round was led by Founders Fund, Peter Thiel’s venture capital firm, with strong backing from returning investors including Lux Capital, Joe Lonsdale’s 8VC, Elad Gil, Definition Capital, and Swish Ventures.
Explosive Growth
Since launching two years ago, Cognition’s growth trajectory has been striking. Its flagship product, Devin, an AI-powered coding assistant, has seen annual recurring revenue skyrocket from $1 million in September 2024 to $73 million as of June this year. Despite scaling rapidly, the company has reportedly kept its net burn under $20 million, underscoring unusually disciplined financial management for a hypergrowth startup.
Adding to its momentum, Cognition acquired AI coding startup Windsurf in July, only days after Google lured away Windsurf’s CEO, co-founder, and top researchers. The move was widely seen as a bold statement of intent to consolidate leadership in AI coding.
Cultural Strain Behind the Scenes
Yet, Cognition’s meteoric rise has not come without turbulence. The company has drawn attention for its intense workplace culture, marked by aggressive performance expectations. Just last month, it laid off 30 employees and offered buyouts to its remaining 200 staffers, effectively giving them the choice to exit if unwilling to commit to 80-hour, six-day work weeks.
The move sparked debate across the tech sector about sustainability and talent retention in an industry already grappling with burnout concerns.
The Bigger Picture
Cognition’s latest raise highlights a broader trend: investors are betting big on specialized AI tools with tangible commercial traction. While general-purpose AI has dominated headlines, the rise of Devin suggests that verticalized AI agents with clear revenue pathways can command premium valuations.
The $10.2 billion milestone positions Cognition AI among the most valuable private AI companies today, despite ongoing scrutiny of its internal practices. If it can balance its cultural demands with its financial momentum, Cognition may well cement its place as a defining force in the AI coding revolution.
