So why are we talking so much about Cursor, Claude Code, etc? Well for a good reason. Not only did both rocket to $1B ARR in less than one year, no it’s more than that. Coding is 55% of all departmenal AI spend, per the latest Menlo Ventures analysis. 55% of All Departmental AI Spend Is Now on Coding. And It’s Not Slowing Down. That’s $4.0 billion out of $7.3 billion total. Not AI SDRs or chatbots. Not content generation. Not customer support. Coding. This is why Cursor, Claude Code, Replit, Supabase and the whole AI coding ecosystem are exploding. It’s not hype. It’s where the money is actually going. The Scale of What’s Happening Departmental AI spending hit $7.3 billion in 2025, up 4.1x year-over-year. Coding alone went from $550M in 2024 to $4.0B in 2025. That’s 7x growth in twelve months. 50% of developers now use AI coding tools daily. At top-quartile organizations, it’s 65%. Code completion hit $2.3 billion. Code agents and AI app builders exploded from near-zero. Teams are reporting 15%+ velocity gains across the software development lifecycle—from prototyping to refactoring to QA to deployment. And Cursor hit $200M in revenue before hiring a single enterprise sales rep. Pure PLG. Developers found it, loved it, and pulled it into their companies. This is what product-market fit looks like at scale. #Data is beautiful menlovc.com/perspective/2..