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Stability AI Is Falling Apart

Instability AI

AI image generation company Stability AI is in big trouble.

Several key AI developers who worked on Stable Diffusion, the company's popular text-to-image generator, have resigned, Forbes reports.

Stability AI CEO Emad Mostaque announced the news during an all-hands meeting last week, per Forbes, revealing that three of the five researchers who originally created the foundational tech that powers Stable Diffusion at two German universities, had left.

It's a worrying blow to a company that once was at the forefront of the ongoing generative AI race — and a sign that even in the white-hot AI industry, success is anything but guaranteed.

Brain Drain

The company has already struggled with dwindling cash reserves and departures of executives. In August, six senior hires, including the company's chief operating officer and head of research, left the company.

Researchers close with the original creators of the tech that led to the creation of Stable Diffusion have since accused the company of misleading the public over how much its employees had contributed to the tool's development, as Forbes previously reported. In other words, Mostaque underplayed just how heavily his company was leaning on existing research by the scientists, several of whom have now left Stability AI.

In August 2022, in the early days of the AI craze, Mostaque raised $100 million for the venture at a $1 billion valuation. But after over a year of considerable spending — Bloomberg reported in November that the company was spending $8 million a month — funds are tight, with wages and expenses on computing power greatly exceeding revenue, according to documents obtained by Forbes.

That's despite the company raising $50 million last year in conditional funding from chipmaker Intel.

The news also comes after AI image generation competitor Midjourney accused Stability AI staffers of scraping huge amounts of important data, including prompt and image pairs, banning all workers at the firm of using its services.

Plenty of questions remain. Are the latest departures a sign that we've hit peak AI — or is this kind of researcher churn to be expected in a red-hot industry? After all, several major tech giants have since announced their own AI image generators.

Considering the central role of the three researchers who have now resigned, there may be more going on behind the scenes. Was there a falling out, or did they find a more lucrative gig elsewhere?

All in all, considering the steady stream of key figures leaving the company over the last year, the company's future is anything but certain — an ironic fate given the company's name.

More on Stability AI: Midjourney Bans Stability From Using Its Images Without Permission