Navigating AI Value Creation

Varun Mohan is the co-founder and CEO of Windsurf (formerly Codeium), an AI-powered development environment (IDE) that has been used by over 1 million developers in just four months and has quickly emerged as a leader in transforming how developers build software. Prior to finding success with Windsurf, the company pivoted twice—first from GPU virtualization infrastructure to an IDE plugin, and then to their own standalone IDE.

In this conversation, you'll learn:

1. Why Windsurf walked away from a profitable GPU infrastructure business and bet the company on helping engineers code

2. The surprising UI discovery that tripled adoption rates overnight.

3. The secret behind Windsurf's B2B enterprise plan, and why they invested early in an 80-person sales team despite conventional startup wisdom.

4. How non-technical staff at Windsurf built their own custom tools instead of purchasing SaaS products, saving them over $500k in software costs

5. Why Varun believes 90% of code will be AI-generated, but engineering jobs will actually increase

6. How training on millions of incomplete code samples gives Windsurf an edge, and creates a moat long-term

7. Why agency is the most undervalued and important skill in the AI era

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• Brex—The banking solution for startups

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Where to find Varun Mohan:

• X: https://x.com/_mohansolo

• LinkedIn: https://www.linkedin.com/in/varunkmohan/

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Where to find Lenny:

• Newsletter: https://www.lennysnewsletter.com

• X: https://twitter.com/lennysan

• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/

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In this episode, we cover:

(00:00) Varun’s background

(03:57) Building and scaling Windsurf

(12:58) Windsurf: The new purpose-built IDE to harness magic

(17:11) The future of engineering and AI

(21:30) Skills worth investing in

(23:07) Hiring philosophy and company culture

(35:22) Sales strategy and market position

(39:37) JetBrains vs. VS Code: extensibility and enterprise adoption

(41:20) Live demo: building an Airbnb for dogs with Windsurf

(42:46) Tips for using Windsurf effectively

(46:38) AI’s role in code modification and review

(48:56) Empowering non-developers to build custom software

(54:03) Training Windsurf

(01:00:43) Windsurf’s unique team structure and product strategy

(01:06:40) The importance of continuous innovation

(01:08:57) Final thoughts and advice for aspiring developers

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Referenced:

• Windsurf: https://windsurf.com/

• VS Code: https://code.visualstudio.com/

• JetBrains: https://www.jetbrains.com/

• Eclipse: https://eclipseide.org/

• Visual Studio: https://visualstudio.microsoft.com/

• Vim: https://www.vim.org/

• Emacs: https://www.gnu.org/software/emacs/

• Lessons from a two-time unicorn builder, 50-time startup advisor, and 20-time company board member | Uri Levine (co-founder of Waze): https://www.lennysnewsletter.com/p/lessons-from-uri-levine

• IntelliJ: https://www.jetbrains.com/idea/

• Julia: https://julialang.org/

• Parallel computing: https://en.wikipedia.org/wiki/Parallel_computing

• Douglas Chen on LinkedIn: https://www.linkedin.com/in/douglaspchen/

• Carlos Delatorre on LinkedIn: https://www.linkedin.com/in/cadelatorre/

• MongoDB: https://www.mongodb.com/

• Cursor: https://www.cursor.com/

• GitHub Copilot: https://github.com/features/copilot

• Llama: https://www.llama.com/

• Mistral: https://mistral.ai/

• Building Lovable: $10M ARR in 60 days with 15 people | Anton Osika (CEO and co-founder): https://www.lennysnewsletter.com/p/building-lovable-anton-osika

• Inside Bolt: From near-death to ~$40m ARR in 5 months—one of the fastest-growing products in history | Eric Simons (founder & CEO of StackBlitz): https://www.lennysnewsletter.com/p/inside-bolt-eric-simons

• Behind the product: Replit | Amjad Masad (co-founder and CEO): https://www.lennysnewsletter.com/p/behind-the-product-replit-amjad-masad

• React: https://react.dev/

• Sonnet: https://www.anthropic.com/claude/sonnet

• OpenAI: https://openai.com/

• FedRamp: https://www.fedramp.gov/

• Dario Amodei on LinkedIn: https://www.linkedin.com/in/dario-amodei-3934934/

• Amdahl’s law: https://en.wikipedia.org/wiki/Amdahl%27s_law

• How to win in the AI era: Ship a feature every week, embrace technical debt, ruthlessly cut scope, and create magic your competitors can't copy | Gaurav Misra (CEO and co-founder of Captions): https://www.lennysnewsletter.com/p/how-to-win-in-the-ai-era-gaurav-misra

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Recommended book:

• Fall in Love with the Problem, Not the Solution: A Handbook for Entrepreneurs: https://www.amazon.com/Fall-Love-Problem-Solution-Entrepreneurs/dp/1637741987

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Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com.

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Lenny may be an investor in the companies discussed.

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