Cursor and SpaceX will partner in a deal that will give the AI company xAI's Colossus infrastructure to scale up its models. SpaceX will pay Cursor $10 billion for the joint models or pay $60 billion for the Cursor. Think of it as a circular deal meets try-before-you-buy acquisition.

As you’d imagine there’s a lot of commentary (some of it comical) on this arrangement, but the core themes are:

• Why did SpaceX buy xAI if it needs Cursor? We know the answer to that one—Elon. Another note: Why did SpaceX pay $250 billion for xAI? Same answer.
• SpaceX needs to monetize xAI’s Colossus infrastructure somehow.
• Cursor needs its own models to survive and they need to be cutting edge. xAI by the way needs models too.
• And xAI hired two Cursor co-founders so why not get the rest?

In any case, Cursor is doing good work and hopefully that’ll keep coming. We can have Claude and Codex running away with all the code.

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