Zed Industries, the open-source AI coding platform, has raised $32 million in a Series B funding round led by Sequoia Capital, bringing its total funding to more than $42 million. The investment marks a pivotal moment for the company as it expands its vision beyond being “the world’s fastest editor” to reimagining how human developers and AI agents collaborate on software projects.
Central to this new phase is DeltaDB, Zed’s operation-based version control system that takes a different approach from conventional tools. While existing systems like Git typically track changes at the commit level, DeltaDB records every single edit in real time. This enables continuous syncing across teams and ensures that discussions, revisions, and corrections remain tied to the most current version of the codebase.
Zed’s founders argue that today’s collaboration workflows often break down because conversations in pull requests or chat applications lose relevance once the code changes. With DeltaDB, “every clarification, pivot, and correction—whether from humans or AI agents—remains permanently tied to the codebase, preserving full context as projects grow.”
Built on Conflict-Free Replicated Data Types (CRDTs), DeltaDB is fully compatible with Git, ensuring interoperability with existing developer workflows. True to Zed’s open-source ethos, the technology will be made freely available, with an optional paid service for teams that want managed infrastructure—mirroring the company’s approach with its IDE.
The move underscores Zed’s ambition to carve out a distinct place in the developer tools ecosystem, moving beyond the crowded space of Visual Studio Code derivatives. By positioning itself as a hub for real-time collaboration and AI-assisted coding, Zed aims to become indispensable for software teams navigating increasingly complex and distributed development environments.
Industry observers see the funding as a vote of confidence in Zed’s long-term vision. The combination of rapid editing capabilities, AI integration, and DeltaDB’s fine-grained version control could give the platform a competitive edge in the race to define the future of programming collaboration.
With fresh capital and a bold roadmap, Zed Industries is betting that its unique approach will reshape not only how code is written, but how entire teams—and their AI counterparts—work together in the years ahead.
