AI coding startup Cognition reportedly already in talks to raise at $40B valuation
Cognition, the maker of AI coding agent Devin, is reportedly discussing a new funding round that could value the company at at least $40 billion. The prospective valuation would underline investor confidence in AI software-development tools and Cognition’s rapid revenue growth, following its $1 billion raise at a $26 billion valuation in May.
Bloomberg sources said the valuation could depend on Cognition reaching a $1 billion annualised revenue run rate. In May, chief executive Scott Wu said annualised revenue was $492 million and enterprise use of Devin had grown 50% month on month for six months; the company says customers include Mercedes-Benz, NASA and Goldman Sachs. Devin is marketed for labour-intensive tasks such as modernising legacy software and migrating applications, rather than directly replacing programmers.
- Cognition may seek funding at a $40 billion valuation.
- The company raised $1 billion at $26 billion in May.
- Devin’s enterprise use has reportedly grown rapidly.
Both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Supporters of a $40 billion valuation would argue that Cognition operates in a strategically important and rapidly expanding market, where capable AI coding agents could reshape how software is built and maintained. If the company has strong technical progress, customer demand and a credible path to becoming core developer infrastructure, raising substantial capital early may help it secure computing capacity, recruit scarce talent and move faster than rivals. They may also see investor willingness to fund it as a rational judgement about unusually large long-term upside rather than simply enthusiasm for AI.
The case against
Sceptics would argue that another sharp valuation increase so soon after a $26 billion round risks getting ahead of demonstrated commercial fundamentals. AI coding is a crowded field with powerful incumbents, high operating costs and rapidly changing capabilities, making it difficult to know which products will sustain pricing power or customer loyalty. From this perspective, disciplined investors should demand clearer evidence of durable revenue, retention and defensible advantages before endorsing a valuation that could create pressure for employees, customers and future backers.
AI Art Business Celebrity Companies Culture Entertainment Technology