Cognition AI Eyes $40 Billion Valuation From New Funding

Cognition AI is reportedly planning a funding round that could more than double its valuation.

The artificial intelligence (AI) coding startup is in discussion with investors about the round, which may lift its valuation to at least $40 billion, Bloomberg News reported late Tuesday (Aug. 11), citing sources familiar with the matter.

This comes less than three months after Cognition raised $1 billion at a $26 billion valuation, the sources added.

According to Bloomberg, investors are hoping to get a piece of a key player in one of the sector’s most popular areas. Cognition’s annualized revenue run rate is nearing $1 billion, around twice the number the firm posted in its earlier financing, the sources said. One of Bloomberg’s sources said Cognition would be expected to raise more than $1 billion in the round.

Cognition makes an AI agent Devin that helps automate engineering work, and counts Citi, Mercedes-Benz, Goldman Sachs, and both the U.S. Army and Navy among its customers.

As Bloomberg noted, coding has become perhaps the hottest area of artificial intelligence, with companies like Anthropic, OpenAI and SpaceX focusing large parts of their businesses on their own engineering efforts.

SpaceX earlier this year agreed to acquire AI coding startup Cursor, with that $60 billion deal expected to become final as soon as this week. OpenAI said in June it plans to expand the capabilities of its Codex coding agent by acquiring Ona, a company that provides cloud execution and orchestration technology.

“Ona will help us make Codex easier to deploy securely across production workflows for customers operating at the highest standards of trust and scale,” OpenAI Core Products Lead Thibault Sottiaux said in a news release at the time.

And last week, Business Insider reported that Google was in talks with AI coding agent startup Mechanize to hire some of that company’s talent and sign a non-exclusive licensing agreement for the company’s technology, a deal worth more than $1.5 billion.

Meanwhile, PYMNTS wrote last month about the challenge companies face in adopting AI coding. While software projects traditionally required major upfront commitments, teams today can use agentic coding tools to prototype multiple product directions at the same time, quickly abandon things that aren’t working while pursuing more promising avenues.

“The cost of experimentation drops sharply, but the volume of experimentation rises just as fast. A company that once funded five software initiatives per year may now launch fifty micro-projects in the same period,” that report said.

“This creates a paradox for CFOs. AI-assisted development can improve efficiency while simultaneously increasing financial volatility.”