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VC heavyweight Vinod Khosla, founder of Khosla Ventures, said acquihires like Windsurf are “bad examples of founders leaving their teams behind and not even sharing the proceeds with their team. I definitely would not work with their founders next time”

Last week, Google poached Windsurf’s cofounders and some key AI researchers for $2.4 billion while AI coding startup Cognition scooped up the remainder of the team and product. The dramatic move stunned the AI community. Windsurf’s interim CEO Jeff Wang said on X that “the mood was bleak” when he shared the news with the company’s 250 employees, who had been expecting to hear about an acquisition by ChatGPT maker OpenAI but instead were told their founders and team were departing to Google. “Some people were upset about financial outcomes… others were worried about the future. A few were in tears, and the Q&A had been understandably hostile.”

Wang said he worked with Cognition’s cofounder and CEO Scott Wu and President Russel Wu to get the rest of Windsurf’s employees the best deal possible. “I think there’s an unspoken covenant that as a founder you go down with the ship. And for better or worse that’s changed a bit over the last year and I think it’s a bit disappointing,” Wu said during a recent podcast.

A recent string of “acquihires,” which has become the playbook for tech companies to avoid antitrust scrutiny while maintaining an edge in the AI race, has left a sour taste in the mouths of a number of venture capitalists. In a typical acquisition, each and every employee who’s worked at the startup would get a financial upside during an exit, but that’s not the case when, on paper at least, no acquisition happens when the founders leave. Cognition did not disclose how much it spent to acquire Windsurf but it’s reportedly a fraction of what Google spent on the deal. VC heavyweight Vinod Khosla, founder of Khosla Ventures, said acquihires like Windsurf are “bad examples of founders leaving their teams behind and not even sharing the proceeds with their team. I definitely would not work with their founders next time.”

Sam Awrabi, founder of Banyan Ventures, which invests in early stage AI-native startups, told me that such deals could also impact the value of equity as a part of total compensation. Historically, that’s been a significant part of pay packages at startups in order to attract........

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