Varun Mohan, co-founder and CEO of the AI startup Windsurf, now finds himself at the center of a firestorm. Just days after a rumored $3 billion acquisition deal with OpenAI fell apart, Mohan and co-founder Douglas Chen left Windsurf to join Google’s DeepMind. Their abrupt departure stunned the startup ecosystem and triggered an avalanche of criticism from investors, founders, and tech insiders alike.
The fallout began almost immediately. Windsurf, once seen as a rising AI infrastructure star, plunged into chaos. Over a single weekend, the company’s remaining team scrambled to rescue the business. They found a lifeline in Cognition AI, which stepped in and acquired the company under immense pressure. Jeff Wang, now CEO of Windsurf, later described the events as “crazy” and admitted the company barely stayed afloat.
Founders Walk Away Amid Turmoil
Mohan and Chen’s decision to exit during such a critical period shocked Windsurf employees and external stakeholders. As the startup teetered on the edge of a high-profile acquisition with OpenAI, both founders instead chose to accept roles at DeepMind, Google’s prestigious AI research division.
Their timing couldn’t have been worse. Reports suggest that their departure blindsided the rest of the Windsurf team. Overnight, the company went from negotiating with one of the biggest names in AI to seeking an emergency rescue deal. Critics say the founders abandoned ship just as their team needed leadership the most.
What angered many wasn’t just their exit—it was how they exited. Industry voices claim the duo left with financial rewards, allegedly without distributing any meaningful share to their team. This move ignited a broader conversation about ethics, leadership, and accountability in Silicon Valley.
Vinod Khosla and Others Speak Out
Renowned venture capitalist Vinod Khosla didn’t mince words. He called out Varun Mohan directly on X (formerly Twitter), writing, “Windsurf and others are really bad examples of founders leaving their teams behind and not even sharing the proceeds with their team. I definitely would not work with their founders next time.”
Khosla’s criticism echoed that of Scott Wu, CEO of Cognition AI, who orchestrated the last-minute acquisition. Wu expressed disappointment and frustration over Mohan’s exit. “There’s an unspoken covenant that as a founder, you go down with the ship,” he said. “For better or worse, that’s changed a bit in the past year. I think it’s disappointing, to be honest.”
Social media exploded with outrage. One user labeled Mohan “a generational villain,” while another condemned the co-founders for “cherry-picking employees to join Google and leaving most of the team behind.” The tech community collectively questioned the founders’ values and commitment to their employees.
Alex Kehr, CEO of Superlocal, which was recently acquired by Foursquare, added his voice to the chorus. “One of my biggest motivations to get to the finish line this year was making sure everyone on my team had a comfortable landing,” he said, highlighting the sense of responsibility that many founders feel toward their teams.
Reputational Fallout Looms
The backlash extended beyond just this incident. Tech leaders warned that decisions like Mohan’s could have lasting consequences. “Founders cashing out while the team’s left behind isn’t just bad form, it’s long-term reputation damage,” one user wrote.
The public nature of the condemnation serves as a cautionary tale. In an industry where personal brand and trust play major roles in attracting talent and capital, Mohan’s exit risks alienating future investors, collaborators, and employees.
A Divided Response: Garry Tan Steps In
Amid the growing criticism, Y Combinator CEO Garry Tan offered a rare defense of Mohan. On X, Tan posted, “Varun Mohan and the team at Windsurf built something great. He and his team don’t deserve to be dragged and I think in the long term their decision to sell will be vindicated. It can be irresistible to fan the flames on internet beef, but in this case, everyone should stand down given what really happened.”
Tan’s post suggested that deeper complexities may exist behind the scenes. But his words didn’t fully cool the temperature. Critics maintained that leadership requires transparency, especially during high-stakes transitions. Mohan’s continued silence only added to the frustration.
Mohan’s Journey: From MIT to Silicon Valley Spotlight
Varun Mohan has long stood out in the tech world. Born to Indian parents who migrated to the U.S., he grew up in Sunnyvale, California. He attended The Harker School in San Jose and later earned both a Bachelor’s and Master’s degree in Computer Science from MIT.
Mohan co-founded Windsurf in June 2021 with Douglas Chen. The startup quickly rose to prominence in Silicon Valley. Windsurf built advanced AI tools designed to streamline software development workflows. Under Mohan’s leadership, the company gained attention from top-tier investors and peers in the AI infrastructure space.
The startup’s meteoric rise made the reported OpenAI deal seem like a fitting next step. That’s why its collapse—and Mohan’s swift move to DeepMind—felt like a betrayal to many.
The OpenAI Deal That Never Was
Industry sources suggest Windsurf was in the final stages of a $3 billion acquisition deal with OpenAI. If completed, the deal would have marked one of the largest exits in the current AI boom. The acquisition would have placed Windsurf’s tools and team under the umbrella of one of the world’s leading AI labs.
But once Mohan and Chen departed, the deal reportedly disintegrated. OpenAI, known for being selective and methodical in its acquisitions, likely pulled back due to leadership uncertainty. This collapse forced the Windsurf team to seek a last-minute acquirer—Cognition AI—just to survive.
Cognition’s CEO Scott Wu acknowledged the urgency. The rescue deal came together over a single weekend, ensuring that employees still had jobs and that Windsurf’s technology could live on.
What’s Next for Windsurf—and Mohan?
Jeff Wang now leads Windsurf. He inherits a fractured team, a disrupted business plan, and a narrative dominated by betrayal. His biggest challenge lies in rebuilding morale and restoring trust. Under Cognition AI’s umbrella, Windsurf may continue its work, but the journey ahead looks steep.
As for Mohan, he now works at DeepMind, arguably one of the most prestigious AI institutions in the world. But he carries with him a cloud of controversy. While he may contribute meaningfully to Google’s AI ambitions, his departure from Windsurf may follow him for years, especially in an ecosystem where founder reputation matters deeply.
Final Thoughts
Varun Mohan’s story has shifted from one of brilliance to one of betrayal—at least in the eyes of many. While he helped build a promising company from scratch, his abrupt exit during a critical juncture sparked outrage and disillusionment. The fallout raises important questions about founder ethics, employee loyalty, and the cost of chasing the next big thing.
In the fast-paced world of AI startups, exits and acquisitions remain part of the game. But how leaders handle those transitions defines their legacy. For Varun Mohan, the legacy now feels far more complicated than the code he once wrote.
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