Key Points
Kilo Code has developed an "ambient coding" plugin compatible with programming applications like Microsoft Visual Studio Code. The company was founded earlier this year by a team that includes Sid Sijbrandij, former co-founder and CEO of code collaboration platform GitLab. Kilo has secured $8 million in seed funding from investors including Breakers, Cota Capital, General Catalyst, Quiet Capital, and Tokyo Black.
In October 2025, Kilo Code’s team, including co-founder and CEO Scott Brightnorth and former GitLab CEO Sid Sijbrandij, gathered in Amsterdam for an all-hands meeting. Investors are betting that there’s still room for startups in the AI-assisted software engineering space. Kilo Code stands out due to its founding team, which includes Sijbrandij, who helped popularize GitLab’s source code collaboration, deployment, and testing tools before its 2021 IPO (now valued at over $6 billion).
On Wednesday, Kilo Code announced an $8 million seed round from Breakers, Cota Capital, General Catalyst, Quiet Capital, and Tokyo Black. Sijbrandij, a self-taught developer, stepped down as GitLab CEO last year to focus on cancer treatment but remains board chairman. Meanwhile, the tech industry has embraced "ambient coding"—using large language models to write and update software—a term coined by OpenAI co-founder Andrej Karpathy in February.
Earlier this year, OpenAI considered acquiring AI code-generation startup Windsurf for around $3 billion but backed out. Google later poached Windsurf’s core team in a $2.4 billion deal. Competitor Cursor raised $2.3 billion in November, reaching a $29.3 billion valuation. Microsoft CEO Satya Nadella revealed in April that 30% of Microsoft’s code is now AI-generated.
Intrigued by these developments, Sijbrandij met Scott Brightnorth, founder of Brooklyn Data, in September. Brightnorth recalled, "I thought it was just a casual chat, but 25 minutes in, Sid asked, ‘Can you start next week?’"
Sijbrandij provided early funding, and Kilo now has about 34 employees globally. Brightnorth handles daily operations but consults frequently with Sijbrandij.
Kilo’s software integrates with tools like Cursor and Visual Studio Code. It’s the top user of OpenRouter’s API, which lets developers access multiple AI models, including xAI’s Grok Code Fast 1. OpenRouter data shows Kilo processed over 3 trillion tokens last month (one token ≈ 0.75 words).
Daniel Langhzaal, a software engineer at Dutch e-commerce startup Plug&Pay, has used Kilo for months after testing Anthropic, Cursor, and Microsoft’s offerings. He praises Kilo’s support for both high-end and budget AI models, as well as its open-source plugin model.
Langhzaal has promoted Kilo internally—80% of Plug&Pay’s developers now use it. One colleague built a complex SQL query in a day with Kilo, a task that might have taken days otherwise.
GitLab, which is testing AI agent task automation, is monitoring Kilo closely and has expressed interest in its tech. Sijbrandij said, "After discussions with the board, we decided to pursue this outside GitLab."
GitLab’s recent filings mention a $1,000 payment to Kilo for a right of first refusal—if Kilo receives an acquisition offer before August 2026, GitLab gets a 10-day negotiation window.
The AI code-generation market is rapidly evolving. Design software firm Figma and other startups now offer ambient coding for non-technical users, and Kilo won’t stay on the sidelines long.
Sijbrandij said, "We aim to be the go-to tool for beginner coders and are developing an app builder inspired by hot startups like Lovable or Bolt."
Sweden-based Lovable raised funding in July at a $1.8 billion valuation.
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