Google is in talks for a $1.5 billion-plus deal with AI coding agent startup Mechanize

Alphabet CEO Sundar Pichai. Bloomberg/Getty Images

Google has discussed a potential talent deal with Mechanize, which trains AI agents to code.

Coding agents are one of the hottest use cases for AI right now.

The deal, which is subject to change, is worth over $1.5 billion, people familiar with the talks said.

Google wants its AI to get better at coding. It might have found a shortcut.

The tech giant has been in discussions with San Francisco startup Mechanize in recent weeks for a potential deal that would involve Google hiring some of Mechanize's talent, four people familiar with the conversations said.

The deal, which some of the people said is worth over $1.5 billion, is in progress, and details could change. Google is discussing a non-exclusive licensing agreement for Mechanize's technology as part of the deal, one person familiar with the matter said. The talent Google could acquire from Mechanize would work on model evaluation and development, the person added.

The talks highlight two realities of the AI boom. Coding has become one of the most important — and lucrative — applications of AI, and Big Tech companies are getting creative about how they acquire the talent and technology they need to stay competitive.

It wouldn't be the first time Google has done a workaround deal for talent and technology. In the past couple of years, Google has structured acquisitions as hybrid transactions that include bringing in talent via acquihires and gathering technology through licensing and other methods. Companies sometimes take this approach to avoid the  antitrust scrutiny of full acquisitions.

Last year, Google swept in to acquire Windsurf's talent and licensed its tech after OpenAI tried to buy it. Windsurf's CEO, Varun Mohan , now leads Google's Antigravity, an agentic coding platform. In 2024, the search giant rehired Character AI cofounder Noam Shazeer and paid for non-exclusive rights to use the startup's AI technology (Shazeer recently left the company to join OpenAI).

Google declined to comment over email. Mechanize declined to comment.

Mechanize launched last year with a mission of automating every job and a star-studded group of investors, including former GitHub CEO Nat Friedman, Stripe CEO Patrick Collison, and podcaster Dwarkesh Patel.

The startup said earlier this year that it raised $9.1 million in a funding round at a $500 million valuation. Mechanize's CEO, Tamay Besiroglu, previously cofounded Epoch AI, which also focused on testing AI models.

Mechanize's tech can help tech companies improve the performance of their AI models at coding — something Google has struggled with, while OpenAI and Anthropic have scooped up developer customers with Codex and Claude Code.

Mechanize has wider ambitions than coding. "Our current focus is software engineering, but our long-term goal is the full automation of valuable work across the economy," its website reads.

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