SpaceX just cut a $60B deal with an AI startup built by 4 MIT dropouts — its CEO is 25 and worth $1.3B

Elon Musk's SpaceX just made a deal with a coding startup founded by four college kids who dropped out of MIT three years ago.

On April 21, SpaceX announced on X (1) that it is working together with Cursor, an AI coding tool used by 64% (2) of Fortune 500 companies, to develop what it called "the world's best coding and knowledge work AI."

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The deal has two parts: SpaceX pays Cursor $10 billion for their work together, or it acquires the company for $60 billion later this year.

As SpaceX put it, "the combination of Cursor's leading product and distribution to expert software engineers with SpaceX's million H100 equivalent Colossus training supercomputer will allow us to build the world's most useful models." (3)

Cursor CEO Michael Truell responded on X that he was "excited to partner with the SpaceX team to scale up Composer" — the name of Cursor's AI model. (4)

So who is Michael Truell, and how did he build a $60 billion company?

Truell grew up in New York City and attended Horace Mann, a private prep school in the Bronx. He enrolled in MIT, finished his first year, and landed a summer internship at Google at 18, where he worked on language models for feed ranking.

During that internship, he met Ali Partovi — an early investor in Facebook and Airbnb — who was recruiting for his Neo Scholars program, an accelerator for young tech talent. Truell completed a written coding test Partovi gave him in record time, and Partovi marked his name so emphatically that he committed to invest in whatever Truell built next. Truell became one of just 30 Neo Scholars selected that year, and Partovi became one of Cursor's first investors. (5)

Truell and three MIT classmates — Aman Sanger, Sualeh Asif and Arvid Lunnemark — left school in 2022 to start Anysphere, the company behind Cursor. Their first two ideas to build a coding assistant for mechanical engineers and a message encryption project failed. They then pivoted to AI coding — a space they had initially avoided because, as Truell told Y Combinator's AI Startup School, "we thought it was too competitive." (6)

Cursor launched in March 2023 and became what many in the industry call one of the "fastest-growing SaaS companies" in history (7), reaching $100 million in annualized revenue in 12 months — even faster than Slack in its early days. Cursor's valuation went from $2.5 billion in January 2025 to $29.3 billion by November 2025 after raising $2.3 billion in Series D funding (8).

In an October 2025 interview on CNBC's Squawk Box, Nvidia CEO Jensen Huang called Cursor his "favorite enterprise AI service" and said that almost everyone of Nvidia's roughly 40,000 engineers now use it — a declaration that carries weight because Nvidia's engineers build the GPU infrastructure that powers the entire AI industry. (9)

Google CEO Sundar Pichai also told Bloomberg Tech in San Francisco in June 2025 that he'd been using Cursor to build custom webpages, which is impressive because Google competes directly in the AI tools space and its CEO was using a rival startup's product for fun. (10)

Forbes estimates that Truell holds roughly a 4.5% stake in Anysphere, putting his net worth at approximately $1.3 billion. (11)

Why SpaceX wants a coding tool — and why the timing is everything

A rocket company buying an AI coding startup sounds strange, but it makes more sense when you understand what SpaceX is about to do.

SpaceX filed its confidential IPO registration with the SEC on April 1, 2026, targeting a June listing at a valuation of $1.75 trillion — which would make it the most valuable company ever to go public, surpassing Saudi Aramco's 2019 record by a significant margin (12). It already merged with Musk's xAI in February in a deal valued at $1.25 trillion, making the combined company a rocket-satellite-AI conglomerate (13).

The Cursor deal is central to that timeline. As TechCrunch reported, SpaceX is deliberately delaying any Cursor acquisition until after the IPO, partly to avoid updating its confidential financial filings before the listing, and partly because it would be far easier to finance a $60 billion purchase using newly public stock. (14)

In the meantime, Cursor gets access to SpaceX's Colossus supercomputer — one of the largest GPU clusters in the world — while SpaceX gets to position itself to public investors as an AI company, and not only a space and satellite business.

Wall Street pays dramatically higher valuation multiples for AI companies than for aerospace, and that difference could add hundreds of billions of dollars to SpaceX's market value on the day it prices its IPO shares.

The deal also came together fast. TechCrunch reports that just hours before the SpaceX announcement, Cursor was on track to close a $2 billion funding round — led by Andreessen Horowitz, Thrive Capital and Nvidia — that would have valued the company at $50 billion. SpaceX effectively swept in and preempted the round. (14)

Microsoft had also looked at acquiring Cursor before choosing not to proceed, according to CNBC. (15)

What this means for investors

SpaceX is not yet publicly traded. Investors can currently access indirect exposure through ETFs: the XOVR ETF holds a 16.2% SpaceX allocation and the Destiny Tech100 fund (ticker: DXYZ) holds approximately 23% (16). At IPO, which should be by June, SpaceX is reportedly planning to allocate 30% of shares to retail investors, which is three times the Wall Street norm of roughly 10%.

On the AI coding side, the market Cursor dominates is the fastest-growing segment in enterprise software. One of Cursor's competitors is OpenAI's Codex, which crossed four million active users (17) on the same day SpaceX announced the Cursor deal. There's also Anthropic's Claude Code, which has helped push the company's annualized revenue to over $30 billion as of April 2026 (18). Although neither of these companies are public yet.

Cursor is currently winning the AI coding industry, and even better with its collaboration with SpaceX. But it's still unclear whether it'll make it on its own or be absorbed into Elon Musk's expanding tech empire.