This Startup Went From $0 to $100M ARR in 12 Months

How AI coding startup Cursor surpassed OpenAI and others to reach $100M ARR in just 12 months — a compelling case study in hypergrowth.

Hi, it’s Andreas. I’m not only back from my vacation in Thailand, but also back with Growth, my newsletter that dives deep into the funnels and growth tactics of today’s top startups.

Today, we’re diving into a startup with probably the most impressive growth journey we’ve covered so far—one that even outperformed OpenAI’s explosive rise.

So, let’s jump in.

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If you're interested in startup growth and have kept your eyes open over the past few months, you've probably seen this graphic:

Source: Sacra

This shows the impressive growth numbers of several popular SaaS startups - all in comparison to the tool we're covering here:

Cursor.

Cursor is a code editor with built-in AI features, like an AI chat. You know, those (for us non-techies) weird-looking control centers where you type in lines of code and - magically - a full product comes out.

That means, with Cursor, developers now have an AI sparring partner - one they can ask questions while coding, that helps find bugs and assists in coding at light speed.

But not only does this sound fascinating (at least to me), but what's even more fascinating is that the startup is hitting $100M ARR in just 12 months. IN. JUST. 12. MONTHS.

With zero marketing budget.

That alone is reason enough to break it down. But while many articles only scratched the surface of its growth story - and left me unsatisfied after reading - I had to take a closer look myself.

So, ladies and gentlemen, buckle up — we’re diving deep.

Cursor’s Explosive Growth

The Engineer of the Future

In 2022, an “applied research lab” called Anysphere came into existence. As it describes itself, it is “working on automating coding.”

Its ultimate goal is “to build the engineer of the future: a human-AI programmer that's an order of magnitude more effective than any one programmer.”

The team's first step in this direction was the launch of the AI startup Cursor - co-founded in 2022 by four gentlemen: Michael Truell, Sualeh Asif, Arvid Lunnemark, and Aman Sanger, all of whom were students at MIT at the time.

This alone gave the team some credibility in the space.

When we look at the story of Cursor, it’s a straightforward “we’re doing things better” kind of success story.

In an episode of Lex Fridman’s podcast, the Cursor founders talked about how they had used GitHub Copilot for several projects. Copilot is GitHub’s AI-powered code editor that helps speed up development.

But when the Cursor founders first heard about the ChatGPT-4 model back in 2020, they decided to step in and take things to the next level.

One founder in particular I want to highlight - who played a major role in Cursor’s growth story - is Aman Sanger.

More specifically, his tweets were a catalyst for Cursor’s early success.

How to Build Momentum with Twitter for a Product Launch

Aman had been posting consistently over the past couple of years.

Then in November 2022, one of his tweets took off. He shared some proof about how well AI coding tools were working - which is exactly what Cursor is all about. That tweet kicked off the momentum build-up until the launch of Cursor.

Over the following weeks and months, he continued posting consistently about these topics - sharing his thoughts on AI coding and AI models.

This served both to build momentum ahead of Cursor’s official announcement and, it seems, to test the very hypotheses the team would later pursue with Cursor.

More and more of Aman’s tweets started to resonate with the audience, helping him build a strong voice in the AI coding space.

Until he finally announced the launch of Cursor with a video snippet showing how it can be used to fix bugs, develop features, and use an AI chat to ask questions about your codebase - a post that went viral with his newly built audience.

With a ton of engagement, retweets, and comments - including Notion’s founder, Ivan Zhao, asking if he could test it at Notion - Aman ended the post with a subtle call to action, hinting at a waitlist. In the comments, people were actively asking to try the tool.

This moment marked the beginning of Cursor’s growth.

💡 That’s a very valid strategy for testing hypotheses for your startup. Once you’ve built a (small) audience, start posting about the problems or hypotheses you’re trying to solve with your product or startup.

Based on the engagement and comments, you can get an indication of whether it resonates or not.

Cursor’s landing page was simple.

It featured a header, a value proposition, and a field to enter your email address to join the waitlist.

In the top right corner, there was a tweet linked with the call to action: “Read the announcement.”

Unfortunately, I couldn’t find details on how the waitlist signups went. But judging by the engagement numbers on Twitter and the comments, I assume it was pretty successful.

Three months later, they publicly launched their beta - announcing a partnership with OpenAI, early access to GPT-4, and further improvements to the tool. That likely led to a significant increase in signups.

How Cursor Got User Input to Iterate

Unlike other startups we’ve covered here, like Linear, Cursor didn’t build a closed community on platforms like Slack for discussions and feedback - instead, they built a simple forum.

They regularly updated their users on changes and gave them the opportunity to provide feedback.

Looking at the oldest entries, the forum dates back to August 2023 - a couple of months after the launch. It’s clear that people were engaging, actively using the product, and sharing feedback that Cursor could iterate on. Which made the forum an integral part of the tools’ product development.

💡 If you launch a product, create a way for people to provide feedback and for you to update them quickly.

This doesn’t necessarily have to be a community, but it’s one of the easiest and most effective ways to stay close to your target audience. Of course, you need to be active and keep them updated regularly.

And the way Cursor is doing it is a prime example of engaging with their target audience and actively listening to feedback - even updating them beyond the forum.

From Developer Hype to Real Traction

At some point, Cursor started spreading like wildfire among developers. Whether it was on Twitter, Reddit, or niche dev communities, people were talking about it.

There were a few clear reasons behind this momentum:

1. The Product
Cursor delivers real value to its target audience. It improves on existing solutions and solves real developer pain points. When a product truly helps, people naturally talk about it - and that’s exactly what happened.

2. The Focus
Unlike traditional SaaS companies that rely on top-down enterprise sales, Cursor took a developer-first, bottom-up approach. It let individual developers try it out, fall in love with the tool, and eventually bring it into their teams. This kind of adoption feels organic, works quickly, and is far more cost-effective than traditional sales methods.

3. The Freemium Model
Cursor offers 2,000 free AI code completions per month. That’s enough for developers to really understand the value without committing upfront. Once they see what it can do, many naturally upgrade to paid plans. This approach allowed Cursor to grow steadily from the ground up.

Thanks to this strategy, they managed to attract developers from companies like OpenAI, Midjourney, Perplexity, and Shopify. And they used those names smartly in their marketing, which helped boost awareness even more.

And of course, having world-class investors doesn’t hurt either.

Cursor raised $8 million in seed funding led by OpenAI’s Startup Fund, with participation from GitHub’s former CEO Nat Friedman, Dropbox co-founder Arash Ferdowsi, and other top-tier angels.

But the momentum didn’t stop there.

In 2024 and 2025, Cursor went on to raise both Series A and B rounds, with Andreessen Horowitz joining in.

And they put it best:

“Cursor, distinctly among AI coding tools, has simply gotten it right... Users give glowing reviews, many have started to pay, and they rarely switch back to other IDEs. Most of the a16z Infra team have also become avid Cursor users!

This early success is due to the clear vision and relentless execution from Michael Truell, Aman Sanger, Sualeh Asif, Arvid Lunnemark, and the rest of the Cursor team. They are obsessed with the problem of better AI coding, and they are laser-focused on building a great developer experience. ”

All of this?

Achieved with zero marketing budget.

Now, Cursor is starting to shift focus toward scaling into the enterprise world - and building the team to do it.

Final Thoughts

Cursor is a great example of explosive growth - and of hitting a real, widespread need. At its core, though, it's a simple story: take something that exists (like GitHub Copilot), do it better, and aim it at the right people.

That’s what led to its virality, big-name backing, and now - according to various sources - Cursor is reportedly in talks to raise hundreds of millions at a valuation nearing $10 billion.

You might be thinking: “Sure, but Cursor had famous investors. That’s not something I can replicate.”

Wrong.

There’s a lot here that you can take and apply:

Takeaways

• Validate your problem on social media
  Cursor’s founder used platforms like Twitter to test ideas, share progress, and confirm there was real demand. You can do the same - fast, free, and direct.

• Create a space for feedback
  Cursor used a simple forum. You don’t need anything fancy - just give users a place to talk, and listen closely. Then iterate based on what you hear.

• Don’t go after the biggest fish first
  Instead of targeting enterprises, Cursor focused on individual developers. Once they loved it, they brought it into their teams. Bottom-up growth > traditional sales.

See you next week! 👋🏼

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