The archive · Developer & Business Tools · Strategic decision · 2025–2026
Kilo Code bets open source beats Cursor in AI coding; Anaconda buys it
Open-source, model-agnostic VS Code coding agent grows to 3M+ developers in 16 months, then gets acquired by Anaconda after an $8M seed.
Kilo Code
What the business is
Kilo Code makes an open-source AI coding agent that works as a VS Code/JetBrains extension, CLI, web and Slack app, letting developers run 500+ models and parallel agents without vendor lock-in.
Starting capital：$8M seed announced 2025-12-10, led by Cota Capital with Breakers, General Catalyst, Quiet Capital and Tokyo Black; plus early capital from Sijbrandij
How it started
Kilo Code began in early 2025 as an open-source AI coding extension for VS Code, just as OpenAI co-founder Andrej Karpathy's February 2025 'vibe coding' coinage made AI-written software mainstream. In September 2025, GitLab co-founder Sid Sijbrandij — who had stepped down as CEO to focus on cancer treatment — was introduced to founder Scott Breitenother, who had started and sold consultancy Brooklyn Data; 25 minutes into the meeting Sijbrandij asked him to start the following week and contributed early capital.
What happened
The extension spread by word of mouth, becoming the most-used app on OpenRouter and processing 3T+ tokens in a month by December 2025, when Kilo announced an $8M seed led by Cota Capital. In April 2026 it rebuilt the extension around a shared engine with parallel subagents, an Agent Manager and git worktrees; after the GA release, three weeks of public iteration fixed Windows memory and rate-limit issues (188 community PRs in one week alone). On May 5, 2026 it relaunched on Product Hunt and took #1 Product of the Day and #1 Product of the Week, plus the May 2026 monthly crown, with 2.3M+ IDE installs.
How it ended up
On July 15, 2026 Anaconda announced it acquired Kilo Code (terms undisclosed) to extend its AI platform 'from first prompt to production'; Kilo kept operating with no immediate changes to products, plans or support for existing users.
Background
Kilo Code began in early 2025 as an open-source AI coding extension for VS Code, co-founded by Scott Breitenother (who founded and sold consultancy Brooklyn Data) and GitLab co-founder Sid Sijbrandij, who joined after stepping down as GitLab CEO to focus on cancer treatment. Its bet: developers would choose an open, model-agnostic coding agent over closed rivals such as Cursor, running any of 500+ models with no vendor lock-in and no token markup.
The bet rode the 'vibe coding' wave that OpenAI co-founder Andrej Karpathy named in February 2025. Kilo became the most-used app on OpenRouter, processing 3 trillion tokens in a month by December 2025, when it announced an $8M seed led by Cota Capital with Breakers, General Catalyst, Quiet Capital and Tokyo Black. In April 2026 it rebuilt the VS Code extension around a shared engine with parallel subagents, an Agent Manager and git worktrees, then fixed GA issues in three weeks of public iteration with the community's 188 PRs in one week.
On May 5, 2026 Kilo relaunched on Product Hunt and took #1 Product of the Day and #1 Product of the Week, then the May 2026 monthly crown; IDE installs passed 2.3 million. By July 2026 it reported more than 3 million developers and trillions of tokens per month. On July 15, 2026 Anaconda announced it had acquired Kilo Code to extend its platform 'from first prompt to production', keeping Kilo's products, plans and support unchanged for existing users.
What has to be true
- Vibe coding went mainstream in 2025 — Cursor raised $2.3B at a $29.3B valuation — leaving room for a developer-first alternative without lock-in.
- Open source and BYOK let Kilo be free to adopt and iterate publicly; the community shipped 188 PRs in one week alone after the April 2026 rebuild.
- Model-agnostic access (Claude, GPT, Gemini, Grok, local models) matched what developers actually wanted: choice and cost control at provider rates.
- A distribution asset — 3M+ developers and trillions of monthly tokens — is exactly what enterprise platform vendor Anaconda needed to extend its stack.
- GitLab's co-founder brought credibility and early capital, but Kilo was deliberately built outside GitLab, avoiding the corporate orbit of its predecessor.
What can be applied
When funded incumbents own a hot market's narrative, an open-source, no-lock-in alternative can win developer distribution — and that distribution is what a platform company will pay for.
Aftermath
As of 2026-09-02, Kilo Code operates as part of Anaconda, which acquired it on July 15, 2026 with terms undisclosed. Anaconda plans to connect Kilo's agentic engineering capabilities to its governed packages, models and environments for enterprise customers; Kilo remains available with no changes to existing products, plans or support. The GitHub repository continues to receive releases, and the product retains its open-source, model-agnostic positioning across VS Code, JetBrains, CLI, web and Slack.
Sources
- Former GitLab CEO raises money for Kilo to compete in crowded AI coding market
- Anaconda Acquires Kilo Code to Power the Trillion-Token Enterprise
- We're back on Product Hunt — here's how far Kilo has come
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