Cognition CEO Denies SpaceX Takeover Talks as Startup Eyes $40 Billion Valuation
Cognition CEO Scott Wu denies SpaceX acquisition talks as the Devin maker seeks funding at a $40 billion valuation and weighs a computing partnership.
Summary
Bloomberg reported on August 19, 2026, that Elon Musk’s SpaceX tried to buy AI coding startup Cognition, citing people familiar with the matter. Cognition CEO Scott Wu called the story inaccurate on X, said Cognition “is not for sale,” and denied talks. Bloomberg said negotiations are inactive but cooperation remains under discussion, potentially using SpaceX computing capacity now sold to AI companies including Anthropic until SpaceX needs it. Wu did not address that claim, and neither company answered TechCrunch’s requests for comment.
Days earlier, SpaceX closed its $60 billion acquisition of Cursor after buying Musk’s xAI earlier in 2026 and completing a June IPO that lifted its peak market capitalization near $2.3 trillion. SpaceX has promoted eventual space based data centers, but xAI trails OpenAI, Anthropic, and Google. Grok also faces enterprise resistance after last year’s “MechaHitler” incident and this year’s nonconsensual sexual imagery scandals. Musk told employees last week that AI could represent 99% of SpaceX’s value in “four or five years,” requiring far more AI revenue. AI coding offers a proven route through Anthropic’s Claude Code growth. Cursor and SpaceX, partners before the acquisition, jointly released Grok 4.6 this month with higher coding and complex agentic task benchmark scores.
Cognition’s Devin and customers Mercedes-Benz, Citi, and Goldman Sachs could strengthen that strategy. Cognition raised $1 billion in late May at a $25 billion post-money valuation and is reportedly discussing another round at $40 billion. Last year it acquired Windsurf’s remaining assets after Google DeepMind paid $2.4 billion to hire its CEO and leading researchers and secure licensing rights. Cognition then cut 30 jobs and offered buyouts to 200 Windsurf employees, with remaining staff facing six office days and workweeks exceeding 80 hours. Musk says he works up to 120 hours weekly and sleeps on office or factory floors.
Positives
- Grok 4.6 posted higher benchmark scores for coding and complex multistep agentic tasks after its joint release by Cursor and SpaceX this month.
- Cognition raised $1 billion in late May at a $25 billion post-money valuation and is reportedly discussing a $40 billion valuation.
- Mercedes-Benz, Citi, and Goldman Sachs already use Cognition’s Devin coding agent, giving the startup an established enterprise customer base.
- SpaceX’s June IPO pushed its peak market capitalization close to $2.3 trillion after it acquired xAI earlier in 2026.
- Anthropic’s growth through Claude Code demonstrates that AI-assisted software development can generate substantial commercial demand.
Risks & concerns
- Scott Wu denied that Cognition held sale talks with SpaceX, directly disputing Bloomberg’s account of an attempted acquisition.
- xAI remains early stage and trails OpenAI, Anthropic, and Google despite SpaceX’s expansive AI ambitions.
- Grok’s “MechaHitler” incident and nonconsensual sexual imagery scandals threaten SpaceX’s efforts to attract enterprise customers.
- Musk’s claim that AI could become 99% of SpaceX’s value within four or five years requires the company to generate far more AI revenue.
- Cognition eliminated 30 jobs and imposed expectations exceeding 80 weekly hours and six office days on Windsurf employees who rejected buyouts.