Factory and Cognition Bosses Clash Over Adviser’s Exit, Bloomberg Reports
Factory’s chief executive Matan Grinberg alleged that an adviser who joined Cognition behaved unethically. The adviser, Cognition, and Vinod Khosla all deny it.
October 1, 2026 - 6:18 pm
Credit: Cognition
As reported by Carmen Arroyo for Bloomberg, the heads of two AI coding startups are fighting in public over an adviser who switched sides.
Factory chief Matan Grinberg announced on X that they were severing ties with Chris Degnan, an adviser for about a year, who was subsequently named chief revenue officer at Cognition, a larger rival.
Grinberg alleged that Degnan held talks with Cognition while he was privy to private discussions about Factory’s business.
"It is sad to sever a relationship with someone who has been a trusted advisor – and even a close friend – for over a year. But Chris’s conduct is unacceptable to me," he wrote.
Denials all round
Degnan, formerly chief revenue officer at Snowflake, stated that he resigned on Monday and turned down a full-time role at Factory.
"Cognition has never asked about information on Factory, nor would I ever give it," he wrote on X.
Cognition CEO Scott Wu and its chief legal officer Paul Grewal both refuted the claims, with Grewal stating that Degnan was hired due to his reputation as one of the world’s top sales leaders.
"We have never tried to get confidential information on Factory," Grewal said.
Investors pile in
Vinod Khosla, whose firm has backed both startups, took Degnan's side and accused Grinberg of lying, according to Forbes.
Sequoia Capital’s Shaun Maguire, a Factory investor, sided with the opposite camp.
"What Cognition doesn’t understand is that we’re sitting on a nuclear weapon to end them," he posted.
The stakes are high. Cognition, maker of the Devin coding agent, secured funding at a $48bn valuation in September. That month, Factory raised $200mn at $5bn, with Khosla Ventures and Sequoia among its backers.
Cognition’s value has jumped since it raised at $26bn. Factory, Grinberg, and Degnan did not respond to Bloomberg's requests for comment.