The bankruptcy estate of FTX sold a 5% stake in AI coding startup Cursor for $200,000 in April 2023, a stake that would now be valued at approximately $3 billion following SpaceX's acquisition agreement at a $60 billion valuation. This deal marks a significant development in the AI coding tools landscape, with SpaceX aiming to bridge the gap with competitors like OpenAI and Anthropic.
The acquisition is part of Elon Musk's strategy, with his company xAI seeking to enhance its position in the market. The crypto aspect of this deal is notable, given that Alameda Research, founded by Sam Bankman-Fried, initially invested $200,000 in Anysphere, the company behind Cursor, in April 2022. This investment represented about 5% of the company at a $4 million valuation.
However, after FTX's collapse and subsequent bankruptcy, the court-appointed estate sold the Cursor stake for the same $200,000, missing out on a potential 15,000x return. This missed opportunity has significant implications, particularly in light of Bankman-Fried's arguments that the estate's rapid liquidation of assets destroyed billions in value, potentially leaving customers with less than they could have received if assets had been held. The Cursor case serves as a prime example of the value that could have been realized, with FTX customers having been repaid in dollar terms but missing out on the substantial upside of assets like the Cursor stake. This example is likely to feature prominently in ongoing discussions about the handling of FTX's assets and the case against Bankman-Fried.