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

In recent weeks, Alphabet CEO Sundar Pichai has engaged in discussions with San Francisco-based startup Mechanize for a potential $1.5 billion-plus deal, according to multiple sources familiar with the talks. The deal, which is still subject to change, may involve Google hiring some of Mechanize's talent and obtaining a non-exclusive license for the company's technology.

This deal could be a strategic move for Google to bolster its AI capabilities, as coding has emerged as a lucrative application of artificial intelligence. The talent Google could acquire from Mechanize would focus on model evaluation and development. This is not the first time Google has pursued a workaround deal for talent and technology; the company has previously structured acquisitions as hybrid transactions that include bringing in talent and licensing technology to avoid antitrust scrutiny.

Mechanize, founded last year, aims to automate various jobs, and its CEO, Tamay Besiroglu, previously co-founded Epoch AI. Mechanize's technology can help tech companies improve their AI models' coding performance, an area in which Google has struggled.