Unlocking Potential: SpaceX and Cursor Deal

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0:40Whether you're refreshing your interior or exterior, we've got the colors to bring your vision to life. And with delivery, getting everything to your door is easier than ever. Shop online to have it delivered or visit your neighborhood Sherwin-Williams store. Click the banner to learn more. Retail sales only. Some exclusions apply. See store for details. Delivery available on qualifying orders. As of today, SpaceX has announced its plans to acquire Cursor, a major vibe coding app. And so we are very excited about this. SpaceX is already off to a huge start after their IPO. Their valuation is absolutely insane and continuing to rise.

1:18Now they're already starting to spend money. So today we're going to talk about this strategic move by SpaceX to acquire Cursor. But before we get into all that, Jaden, why don't you tell them about our school community? Yes. So every single week we record a bonus piece of content over on our school community. And something new that we are doing that we've never done before is that we are going to start live streaming. We're going to do a live video every single Monday at 9 a.m. Eastern time. Unless for some reason I have a new baby and the baby's crying a lot, then we might have to reschedule.

1:49But mostly it's going to be 9 a.m. Eastern time. Every Monday we'll be live streaming a bonus piece of content, which is basically us breaking down how we're growing and scaling our businesses with AI. We'll show you like the inside this week. Jamie and I did our first live stream and he showed how he has set up an entire cold email outreach campaign where he's contacting local businesses for his AI marketing agency. He shows how he got all of the customers, how he's sending the emails, all the tools, the software, the setup. It was an incredible setup. And so he walks us through all of that. And every single week we do new things.

2:23We do different vibe coding things. I have multiple apps, multiple businesses. We show you the revenue, just the stuff we can't publish anywhere else. So there's a live stream every week and also bonus content. And also for the first time ever, we have a free tier of the school community. So if you want to get access to all of our videos, it's$19 a month, but we give you five videos for free on our free tier. And you can catch the live streams every week at 9 a.m. if you want. But if you want the full catalog and access to all the features, it's still$19 a month, but come check it out for free if you haven't already.

2:54Okay, let's talk about, and by the way, there's a link in the description to all of that for the school community. We would love to have you as a member. Okay. Let's talk about everything that's going on with SpaceX. This is crazy because this isn't new. This deal between SpaceX and Cursor has been kind of got laid out in April, basically. But back in April, SpaceX hadn't done their IPO. And so they signed a deal basically with Cursor and they're like, hey, look, we will pay, we will, we're basically buying the option to buy Cursor. We're not buying Cursor today, but we're buying the option to buy Cursor after our IPO.

3:28And if we back out of that deal, I'm trying to remember the breakup clause on this exactly. I think it was something like$2 to$4 billion that they were going to have to pay Cursor. It says$10 billion in this article. $10 billion. Oh yeah, you're right. If the deal falls through, yep. $10 billion. So with$10 billion on the line, they signed this deal. Cursor couldn't go shop to anyone else. It was locked in and it was locked in this specific price. So it's kind of an interesting deal. And I mean, for Cursor, if they're confident that the company could keep growing, they're like, sure, we'll take this deal.

3:57You walk away, we get a free$10 billion. That's not going to hurt anybody. And we could go sell to Google or someone else or just keep running as our own company with$10 billion. Or this will go through and we'll join SpaceX. So SpaceX did just do their IPO a few days ago, and their stock is up 34 % since that IPO happened. It had a massive pop again. It just continues to grow. Jamie, did you buy any SpaceX stock out of curiosity? I did not. I guess I, you know, who knows what actually will happen when there's an IPO. I mean, I think the typical trend is that a lot of times the value drops off right away and then picks up later.

4:38But this did not actually do that. It looks like it's on a run already. So kind of missed out. How about you? Did you buy any? Not financial advice, but I was laying in bed and scrolling Twitter one night, whenever, like I think a few hours after it happened. So I missed like a couple hours after this IPO happened, it bumped up 20%. And anyways, I was like, oh shoot, it already IPO'd, it's up 20%. And I was laying in bed and I'm like, ah, I'll just buy a thousand bucks worth and see what happens. So I haven't put my life savings on it, but I put a thousand dollars in and I'm like, it'll be good for the ride, right?

5:11This is a piece of internet history. It's the biggest private company it's acquired everything in the world it's gonna buy cursor i'm like whatever happens i will just own a thousand dollars and i'll follow along from there so i feel like i have a little skin in the game i'm honestly after i bought it it started like because it had done the 20 jump and i bought it i'm like ah whatever maybe i'm the sucker because it'll go down right and it started going down and i'm like ah whatever and then yeah yesterday i checked and i was up like 20 % on it. And we'll see. Not financial advice, guys. I've done no research except that Elon has other successful companies and SpaceX owns XAI and they're going to shoot data centers into space.

5:50So do I know anything about this company? Basically, whatever I've seen on Twitter. But otherwise, yeah, I'm curious to see what happens with it. Yeah. So anyways, Cursor, the deal between SpaceX and Cursor was for$60 billion with a B in stock. So that's kind of what their, their price point is for this company. I mean, I'm super happy for cursor. This is, that's amazing. Have you, so from, I personally have never used cursor. I, I vibe code with cloud code and lovable from what I understand and correct me if I'm wrong is cursor more geared towards people who are actually trying to launch like full blown apps on the app store where a tool like lovable maybe is like for a marketer doing landing pages and websites and things like that?

6:37Or am I wrong in saying that? You have, yeah, you're not far off. And basically what I would say is Cursor is more like Claude Code basically. Today, like, and I have like a screen kind of sharing it if you're watching the video. But yeah, something like Lovable is definitely more for if you have no coding experience and Cursor is more for like if you have coding experience and you're a little bit more of a developer or you're figuring it out. There's a couple of cool things that you can do with cursor imagine it like cloud code where you're talking to it and it's putting code together you could basically it's everything that cloud code is right so if you go and get an api to like a database like supabase and an api to a hosting like versell and you could have cursor working on your projects and doing everything the same way you you do with cloud code if you have cloud code set up so like that's kind of nice but um the difference that it has that i think is there's some pros and cons over Claude code.

7:33The pro is that you can switch any model into it. And this is what SpaceX is finding, right? They're like, you know, Claude code is only for Claude, obviously. And Google has all of their Gemini kind of AI studio things that are only for Gemini and OpenAI has Codex. And so evidently XAI wants to get Cursor because now they got their own. But Cursor, you can switch any of those other models into it just through the API. So I'm like, oh, I could use Claude with Cursor. So I'm not sure if it's going to keep an exclusive, if it'll have an exclusive deal with XAI to use like Grok to be the exclusive coding agent on here, or if they're going to keep it open where you can just switch in any model that you want.

8:12So I'm really curious how that works. There's a couple of pros and cons. Pro is you get more options, which is cool. Claude seems to be the winner right now, but let's say OpenAI came out with a better model or not even just better, but like sometimes more cheaper, right? It's like 20 % worse, but it's like 80 % cheaper. It's like, well, you could still build basically anything you need. And other than the most complex things, that's a really good value. So having done a lot of development, and I think where the future goes, which I'll get into the future in a second, I think that is a compelling offer.

8:43But the downside is when you're using something like Claude Code, it's$200 a month, and they subsidize it heavily. If you're doing a big project, and you're going to max out your tokens, which is what I've done every single month and every single week and every single five-hour period that I have it. I max out my tokens. And if you max out your tokens, then you're like getting the equivalent of like$10 ,000 worth of tokens for$200. Now, is that going to be like that forever? No, they're subsidizing it heavily. They're going to turn it down. GitHub used to do something similar and GitHub has already shut off the subsidized tokens and now said, you just have to pay API costs for all of your tokens.

9:16So I would expect Anthropical have to do that at some point. They're probably just keeping it subsidized until they get to their IPO to get maximum usage possible. So that's the pros and cons over CloudCode versus Cursor. But Cursor has a lot of enterprise contracts, so they're rolled out into a lot of companies. And so they're kind of like locked in because they were there before CloudCode existed, I think, or the way that CloudCode has kind of been built out now. Anyways, Cursor and CloudCode, you could both build into your coding terminals that you are using. And I'm not a developer, so if you're a developer, don't get mad at me.

9:49But like if you're using like Microsoft has, Microsoft has a very popular one, which I think is like VMware, whatever. I can't even remember. I don't use it. But when you're actually coding in your code, in your, in your code base, you have like cursor could be like embedded into it and helping you do things. And same with Claude code. That's how like my CTO does his coding. I personally just have the Claude app on my computer and Claude code is just tied into, there's like a folder on my computer that is my code base. and then Claude is tied into all of my APIs for all my stuff where it's going to push it to GitHub and then it goes and pushes it to my server or my database or whatever.

10:26So that's how I interface with it. But Cursor can kind of do both of those things. Okay, gotcha. So yeah, I'm trying to... I mean, I think the long-term play here from SpaceX and Elon Musk is they want to take some of the market share from Claude Code. I think so far, I think the leader still, at least right now, people who are developing are using cloud code they want to grab some of that market share and cursor could be the answer to that so i'll see what they do with it i feel like they kind of need a a re a rebrand a refresh xai does at least i think because i don't think anybody that i know of uses xai for anything right now but i could be wrong with that so but i think they need maybe a rebrand.

11:12And I think with all the excitement around SpaceX and the fact that they were the first to IPO, they may be able to take some of that market share. Yeah, it's going to be interesting. One last thing that I thought was so crazy on this story was that with this whole deal, Cursor was actually right about to close a$2 billion round from Andreessen Horwitz, Thrive, and NVIDIA at a$50 billion valuation. And then SpaceX was like, Like, hey, look, we'll buy your whole company in stock for$60 billion. So what's crazy is they had$2 billion lined up for them. And that's kind of why they had to do this$10 billion breakup deal.

11:53Because SpaceX is like, no, no, no, no, don't raise that money. You don't need that. We'll buy you for even more. So anyways, that's pretty crazy. Especially because they had been valued at about$29 billion before that whole announcement happened. So, I mean, it's basically from the$29 billion valuation. they doubled what spacex was gonna was gonna pay for them 60 billion dollars and i still think it was i mean spacex added a trillion dollars to its market cap with their ipo so 60 billion dollars to buy cursor yeah you know change so it's not like they had to like all the money they raised from the ipo they had to go give to cursor like it's stock and spacex so anyways it'll take a while to to play out and it probably has some sort of vesting schedule and a bunch of different things So it should be interesting to see what happens.

12:40Well, hey, if you got any value out of this episode, we'd really appreciate a rating or review wherever you're listening. Those really help us out. We're trying to get to 150 reviews. And then again, check out our AI Hustle School community. You can join the free tier and check out what it's all about and also attend some live streams. So we'd love to have you be a part of it. But thanks for listening and we'll see you guys next time. You're listening to a podcast right now, driving, working out, walking the dog. If you're into podcasts, chances are you have something to say too. With RSS.com, starting your own podcast is free and easy.

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