They bought Cursor for AI. Earlier this year cursor switched to pay per use model, so now every engineer is spending dozens to hundreds of AI Bucks. I don’t think Cursor is profitable on that yet, but I imagine xAI are looking to scale that model, both to turn Grok into something that earns an income, and to scale up to profit despite cost of datacenters/training.
I’m skeptical there is really a profitable market, but it might be the most grounded of his predictions. The technology exists, the business model is successful at a small scale, so they just need to scale
You could probably research the company but from my direct experience
Cursor is one of the stronger contenders for coding - bringing a variety of models to tools where coders are.
Cursor switched to pay per use, significantly increasing costs and didn’t lose customers
cursor charged more for higher end models and didn’t lose customers
grok is not currently there, or at least not what I can see, so is a huge gap from an xAI perspective
it seems good enough business model to business people to be worth a huge purchase
Once grok is added to Cursor, I will just have it, along with a variety of other models, and can simply choose it based on cost and effectiveness. It may even be chosen for me since I usually leave it in automatic, and my company is a paying customer where each engineer spends a budget
Also it’s more like a subscription. Software companies love a subscription model with regular income, rather than selling something you pay for once
They bought Cursor for AI. Earlier this year cursor switched to pay per use model, so now every engineer is spending dozens to hundreds of AI Bucks. I don’t think Cursor is profitable on that yet, but I imagine xAI are looking to scale that model, both to turn Grok into something that earns an income, and to scale up to profit despite cost of datacenters/training.
I’m skeptical there is really a profitable market, but it might be the most grounded of his predictions. The technology exists, the business model is successful at a small scale, so they just need to scale
could you provide details on that?
You could probably research the company but from my direct experience
Once grok is added to Cursor, I will just have it, along with a variety of other models, and can simply choose it based on cost and effectiveness. It may even be chosen for me since I usually leave it in automatic, and my company is a paying customer where each engineer spends a budget
Also it’s more like a subscription. Software companies love a subscription model with regular income, rather than selling something you pay for once