> And it was "only" ~$20 billion. Inflation can't be this high.
While I'm not sure about this buy, Cursor does at least have revenue. WhatsApp was basically running on VC/private money (they had an extremely nominal fee, but I never had to pay it), and was sold to buy its userbase into the Facebook fold. I don't think you can compare that to a business that at least has some decent revenue.
If Whatsapp is burning through say ~$1B yearly with zero revenue and Cursor is burning through say ~$2B with a ~$1B revenue, they're both still in the hole.
I wish people would stop talking about just revenue. It's mostly meaningless without knowing their expenses.
I think revenue is common to talk about because profit is also meaningless when a company spends every penny it earns to grow (new engineers, marketing, etc). Iirc Amazon made zero profit for quite some time.
Also revenue is a signal for product market fit. Is it a great one? Dunno. But for example I'd be hard pressed to sell $1billion of anything, even if I had something everyone wanted.
But I think your point about burn rate is important. How long can they have this attrition on cash before they collapse?
I mean, the financials just don't look great either way.
Their main product is part VSCode, which is a market that's almost impossible to make money in, and part reselling already expensive LLM tokens.
You can look at more parameters and judge how well a company could do in the future. For Amazon, you can predict that once they stop growing, they can make a pretty penny.
But with Cursor that doesn't seem likely. Even if they had the talent for training models from scratch, which I don't think they do, and IF inference makes money, which is not clear at all, training models is still a huge money sink.
So, for them getting bought out by xAi which has a base model they can use makes sense. But what does xAi get here? Another endless money pit?
You're right. I was commenting mostly on "why companies usually talk about revenue than profit"
I think the truth is that it's a new frontier. No one knows if any of this will make money. Investors are just betting that someone else will learn to monetize sometime soon.
I agree. It is a lot of money, but that's the hope from paying engineers well: to make the chances of very expensive mistakes unlikely.
One thing I did think about was how this could have been architected without sufficient reference to costs, which might have been a process or structure improvement.
Right - if your engineering organization ships designs that are bad economically, the solution is to introduce a culture of predicting costs before committing to a design, and processes to help enforce that culture.
Add "expected budget, double-checked by at least one other principal engineer" to the project checklist.
Have the person most responsive for the $8m "mistake" be the person to drive that cultural change, since they now have the most credibility for why it's a useful step!
Ex-Nanopore employee here. One interesting thing we heard about internally was that OceanX[0] has one of our GridION[1] devices (slightly larger, and built-in compute) that they were using to track whales in the ocean by sequencing DNA found in seawater. Really cool.
> The PMs and QAs I know would disagree with that assessment.
It just depends on the org structure and what the org calls different skills. In lots of places now PM (as in project, not product) is in no way a leadership role.
Outlook has never been a requirement for work, you can very easily use any email client or outlook.com web app. Outlook is arguably the easiest to replace.
Excel is the only thing holding Office 365 together.
Word, Outlook, OneDrive, Teams, SharePoint are all very easy to replace
Every organisation I've ever worked in, as an employee and a consultant, has used Outlook for email, meeting scheduling, and room booking, and the underlying Active Directory that manages employee logins, permissions, and how it all links to (Windows) device compliance via GPO.
I tried LibreOffice (Impress) for something simple and it was not good - in fact it would just freeze. Although it did have a feature on MacOS that PowerPoint for Mac didn't, so I ended up using Impress for the first little bit and then PowerPoint for the rest.
> For $17M, one could probably build a vacuum robot prototype that’ll also clean up all of the kids toys and sort LEGO bricks by colour and size. Parents worldwide would love it.
Just write down how you'll spend the money to make that, what it'll eventually cost to produce, what the market size will be, and what the price will be, and if it's enough return you can easily convince someone to give you $17m to do it all.
I live in Oxford, UK and walked past a police van that said "automatic facial recognition in use". Not exactly a good sign without any caveats. I imagine they recorded me staring at their van.
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