Windsurf capsizes and the rise of Musk-onomy

Author

Noel Moldvai
July 16, 2025

TL;DR. Windsurf’s $3 billion dream deal with OpenAI sank fast, with key staff defecting to Google and Cognition Labs salvaging what was left. Meanwhile, Elon Musk is potentially funneling billions from Tesla and SpaceX into his AI startup, xAI, effectively investing in himself. The Musk-onomy is rising, Firefly’s going public, and private markets are heating up.

The Windsurf AI story is the craziest tech story of the year

Windsurf, once the hottest AI coding tool with $100 million in annual revenue, was set to be acquired by OpenAI for $3 billion. Then, overnight, the deal collapsed, the leadership team fled to Google, and the company was gutted. Cognition Labs swooped in to acquire the remnants, saving employee equity and jobs, but at a discount.

Elon Musk plans to potentially fund xAI with billions from Tesla and SpaceX

Elon Musk is attempting to channel billions from his existing companies into xAI (also his company). SpaceX is considering a $2 billion investment, while Tesla shareholders are preparing to vote on a proposal to fund the AI venture. Musk is integrating xAI's Grok into Teslas and blurring corporate lines, raising both strategic potential and investor concerns.

Firefly Aerospace files for an IPO

Firefly Aerospace is going public after a strong year including a moon mission. Despite heavy debt and operational losses, it boasts $1.1 billion in backlogged contracts and big-name partnerships. The IPO aims to unlock liquidity and fuel development of reusable launch vehicles and in-space transportation systems.

Why high-net-worth investors are turning to pre-IPO secondaries

From discounted entry points to access before IPO hype, high-net-worth investors are increasingly turning to pre-IPO secondaries to get exposure to companies like SpaceX and OpenAI. This article unpacks the top reasons behind the trend—growth, innovation, diversification, and the allure of exclusivity.

Quick Takes

Cheerio! Until next week.
-Noel