Anysphere, the startup behind AI coding app Cursor, has struck a deal to acquire top talent from AI-powered customer relationship management (CRM) startup Koala, the Techcrunch reported citing unidentified people.

As part of the agreement, Cursor will recruit several of Koala's several top engineers. However, not all of Koala's employees will be absorbed by Anysphere, and there are no plans to incorporate Koala's customer management technology into Cursor's offerings, per the report.

Anysphere is acquiring talent from failing AI startups to quickly build enterprise capabilities and compete with Microsoft's GitHub Copilot for large corporate contracts.

This comes after Koala said in a blogpost recently that it is shutting down in September. In February, Koala had raised $15 million in Series A funding led by CRV with participation from HubSpot Ventures, Recall Capital and Afore.

Anysphere's agreement to acquire Koala's talent mirrors a growing trend where medium and big tech companies are hiring talent selectively from floundering startups.

In fact, Anysphere also recently brought in the CEO of cybersecurity startup Resourcely, Travis McPeak, to lead the company’s security teams, per The Information report.

Earlier this month, Google hired Windsurf's CEO Varun Mohan, co-founder Douglas Chen and several other employees to its DeepMind division besides signing the licensing rights.

Interestingly, later AI startup Cognition agreed to acquire Windsurf along with the remaining Windsurf team left stranded after the Google deal.