Cognition, an AI coding startup valued at $4 billion, has offered buyouts to about 200 employees it recently acquired from rival startup Windsurf. The offer includes nine months of salary in exchange for leaving the company, according to an internal email seen by The Information.
This comes three weeks after Cognition took over Windsurf and laid off 30 Windsurf staff members. Cognition CEO Scott Wu told the remaining employees they must commit to an intense work culture, saying, “We don’t believe in work-life balance” and that the company expects 80+ hour workweeks over six days.
Windsurf, formerly called Codeium, faced turmoil earlier this year when top executives and engineers left for Google DeepMind after a $3 billion acquisition deal with OpenAI fell apart. Google then licensed Windsurf’s technology for $2.4 billion and hired some staff, leaving over 200 employees behind.
Cognition’s acquisition of Windsurf’s remaining staff and assets has quintupled its own team size, adding many workers in sales, marketing, and support roles. The deal also included paying out all equity compensation Windsurf employees were owed, even if unvested, though the exact value is unclear.
The acquisition boosted Cognition’s revenue, with Windsurf bringing in about $82 million annually, roughly matching Cognition’s own revenue at the time.
This deal highlights risks for startup employees during partial acquisitions. When founders and key engineers leave, remaining employees often face uncertain futures, sometimes receiving buyouts or layoffs instead of the full benefits of a traditional acquisition.
