zlacker

>>swyx+(OP)
I'm skeptical about this VSCode fork commanding a $3 billion valuation when it depends on API services it doesn't own. What's their moat here?

For comparison, JetBrains generates over $400 million in annual revenue and is valued around $7 billion. They've built proprietary technology and deep expertise in that market over decades.

If AI (terminology aside) replaces many professional software engineers and programmers like some of its fierce advocates say it would, wouldn't their potential customer base shrink?

Professionals typically drive enterprise revenue, while hobbyists—who might become the primary users—generally don't support the same business model or spending levels.

What am I missing here?

>>retorn+j62
JetBrains makes $400M in revenue and is 10+ years old. Cursor is 1 year old and makes $300M in revenue.

One is going to be valued at a much higher multiple than the other.

>>ergoco+zF2
$400M in real revenue versus $300M in annual recurring revenue (ARR) are totally different things. Real revenue is money actually earned, while ARR just multiplies one month's subscription revenue ($25M) by 12, ignoring customer churn.

Startups love flashing ARR figures because "$300M ARR" sounds impressive, but without knowing churn rates, they might never actually collect that full amount.

JetBrains however collected real $400M in a year.

>>retorn+DR2
Unless you have reason to believe the revenue is declining in recent months or will decline in near future, ARR is a better metric. last year real revenue made sense only for low growth companies.

>>blacko+Ih3
Cursor just lost access to the extension marketplace and key proprietary plugins that they were using against Microsoft's terms, Windsurf has been eating a chunk of their mindshare, and Copilot is catching up.

That's three good reasons to believe that lots of people will be cancelling in the next months unless something changes.