Stability AI is a British artificial intelligence company that owns the Stable Diffusion model and has recently announced a CEO change. However, a series of bad news has been circulating, with the latest reports indicating financial troubles and a shortfall in capital used to rent high-priced GPU servers.
According to documents obtained by Forbes, Stability AI reportedly incurs a yearly cost of around 99 million dollars for GPU server rentals on the cloud (leased from AWS, Google Cloud, CodeWeaver). This is in addition to other expenses like employee salaries, operational costs, totaling around 54 million dollars annually. Alarmingly, the company’s revenue in 2023 was a mere 11 million dollars.
Further information from Forbes reveals that Stability AI has not fully paid its cloud expenses during the period from July to October 2023. There is no updated information on whether the debts have been settled. Moreover, the company has contemplated not paying taxes to the UK government.
These financial woes have led to a lack of investor confidence in the management team and an inability to raise additional funds as planned. Former CEO Emad Mostaque, who had intended to raise an additional 95 million dollars by the end of 2023, only managed to secure 50 million dollars from Intel, falling short with just 20 million dollars at the end. Plans to raise funds from NVIDIA ultimately fell through.
In addition to financial issues, Stability AI is facing employee problems, with several high-ranking research personnel resigning due to dissatisfaction with the company’s direction, especially concerning model training using copyrighted images.
These challenges have prompted CEO Emad Mostaque to step down, leaving the company’s future uncertain.
TLDR: Stability AI, a British AI company, is facing financial troubles, including unpaid cloud expenses and a revenue shortfall. Former CEO’s fundraising goals fell short, and employee resignations have added to the company’s uncertainties.
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