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Leaked deck raises questions over Stability AI’s Series A pitch to investors

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Re: Leaked deck raises questions over Stability AI’s Series A pitch to investors

#51

Post by impulser_ »

capableweb wrote: post #15

The model was initially released in August 22, 2022, and everything from the GitHub organization that hosted the code, to the actual licenses being around and all the communication made it very clear that there was a bunch of groups involved with the model; Runway, CompVis, and Stability AI Then Stability AI raised money from investors in October 2022. Are you really telling me these investors didn't even do any sort…

It's definitely not far fetched for VC investors to not do any due diligence at all. Obviously not all of them, but there are quite a bit of them that just gamble with their money. Just take a look at how many of them threw money at crypto lol.

Re: Leaked deck raises questions over Stability AI’s Series A pitch to investors

#52

Post by capableweb »

impulser_ wrote: post #51
capableweb wrote: post #15

The model was initially released in August 22, 2022, and everything from the GitHub organization that hosted the code, to the actual licenses being around and all the communication made it very clear that there was a bunch of groups involved with the model; Runway, CompVis, and Stability AI Then Stability AI raised money from investors in October 2022. Are you really telling me these investors didn't even do any sort…

It's definitely not far fetched for VC investors to not do any due diligence at all. Obviously not all of them, but there are quite a bit of them that just gamble with their money. Just take a look at how many of them threw money at crypto lol.

Yeah, again, how many investors invested in a cryptocurrency company and then not until afterwards realized they invested into a cryptocurrency company? Because that's what the article suggests happened, which is obviously ridiculous.

Re: Leaked deck raises questions over Stability AI’s Series A pitch to investors

#53

Post by capableweb »

anonylizard wrote: post #44
capableweb wrote: post #39

Earlier quoted context omitted.

> Stability never had any revenue, nor any easy ways to measure their user base They do, for the products they have/will have. Right now, I think it's only DreamStudio, but like any SaaS product, they can and surely do measure the amount of users, and trivial for them to see the revenue. What you're talking about, the models they help release, are not products themselves, more like research output they give away for…

Dreamstudio is a joke, not intended to be a serious product, but merely for someone to try out SD in under a minute. 99.9% of SD usage happens outside of Dreamstudio. The power of SD comes from using fine-tuned models, and dreamstudio doesn't allow that (For copyright reasons presumably). There are websites like happyaccidents that do allow using fine-tunes, because they are willing to shoulder the massive legal risk…

As someone who develops software using Stable Diffusion and gets sold for money, I'm well aware how simple Dreamstudio is. No professional would use it. Doesn't mean they are not developing it to be a real product, that they'll try to get people to buy for real money.

Re: Leaked deck raises questions over Stability AI’s Series A pitch to investors

#54

Post by emadm »

ad404b8a372f2b9 wrote: post #40
amrrs wrote: post #3

I don't remember Stability claiming in any public forum that they solely developed Stable Diffusion. In fact the first stable diffusion model on Hugging Face is under CompVis Org. They had an issue with Runway with a model takedown or something but I think that was sorted out later on. I don't know why the article seems desparately trying to show Stability in bad light while they have in fact funded a lot of AI model…

Some of their behaviour over the past year makes me feel the company has a culture which doesn't hold honesty as a core value. The Runway takedown or something your refer to was Stability sending a takedown request to HuggingFace claiming an IP leak over the publication of version 1.5 by their academic partners Runway. That was sorted out, if you want to call it that, after massive public outcry and Emad claiming it…

I normally don't like engaging in these things but think should step in given increasing fud.

Stability AI lawyers never contacted HuggingFace requesting an IP takedown. You may ask HuggingFace themselves.

RunwayML agreed not to release 1.5 for safety reasons in writing and then chose to anyone presumably leading to confusion by our tech team who let HF know it couldn't be them.

You can ask them why they did that, Runway being a private company https://www.forbes.com/sites/kenrickcai/2022/12/05/runway-ml...

Three of the 5 authors of latent diffusion including the two lead authors are at Stability AI.

On the Discord it was Discord themselves that did it to the puzzlement of Kaarsetun and I, we are good with each other.

On the Subreddit that was our fault completely, for which I did a public apology around the issues with Automatic1111.

Re: Leaked deck raises questions over Stability AI’s Series A pitch to investors

#55

Post by emadm »

anonylizard wrote: post #32
ericflo wrote: post #4

I think in the world of ML, contributing that much compute should count as co-creation. There is a lot of code published by academia that just needs compute and data, but they don't receive it. Stability deserves credit for Doing the Thing. IP rights are another thing but that's a whole subtree of legal questions that society is barreling towards.

People have to remember, back in 2022-08, AI was still not a big thing. DALLE-2 was only released 2 months ago, and was just a quickly forgotten novelty. Emad had to have funded the training of SD even before DALLE-2, investing the cash in exchange for branding rights to a free model. Its obviously an extremely good bet in retrospect (RunwayML is probably bleeding with regret), giving stability herculean name recogni…

Most of the latent and stable diffusion authors also work at Stability AI, as do many other generative AI research leaders in media.

Naming rights on the model were no part of the compute grant, we give them incredibly freely and also support. Naming was suggested by the researchers in this case.

We don't just put out compute, but made sure to clear up everything from Stable Diffusion 2 onwards 100% trained by Robin and team: https://github.com/Stability-AI/stablediffusion

Re: Leaked deck raises questions over Stability AI’s Series A pitch to investors

#56

Post by emadm »

capableweb wrote: post #25
ShamelessC wrote: post #12

Earlier quoted context omitted.

That they funded the model is not in question. It is that they claimed they owned the IP to said model in pitches/messaging to investors when they in fact, did not.

> they claimed they owned the IP to said model in pitches/messaging Where is the evidence of this? The article certainly doesn't contain anything that proves they claimed the owned the IP.

Yeah, we were always really clear about that, the GitHub is clearly CompVis for example.

We fund dozens of models and collaborate on them too, the ones we assert IP over are those in our GitHub as benchmark models based on open research coded and trained from scratch.

It gets really complex otherwise when you have lots of collaborators eg on the LAION models.

Re: Leaked deck raises questions over Stability AI’s Series A pitch to investors

#57

Post by emadm »

anonylizard wrote: post #36
algo_trader wrote: post #22

Earlier quoted context omitted.

My pet theory is that Stability was a surprise viral hit during aug/sep. Then got a massive capital round. And NOW, growth is already slowing and investors are getting buyers-remorse? Or maybe growth is accelerating, and those who passed on series-A are upset? Or maybe the lizard men are involved?

Stability never had any revenue, nor any easy ways to measure their user base. Their 'growth' is basically dependant on them being able to release open source models that get so popular, unbeatable ecosystems get formed around them. On this front. SD1.4/1.5 is extremely successful, but there has been no followup. SD2.0 was a total disaster that shocked the community, SD2.1 is still no better than SD1.5. StableLM curr…

Stability AI is 18 months old so far and has spent 100x less than OpenAI which was founded in 2015.

I think it unreasonable to compare at this stage, we are still early as a company and organisation.

We have revenue (to be announced) but release models differently as we are not proprietary.

The numbers in that deck were as reported on models developed by team members (we chose not to assert IP rights) in use by various applications.

We were exploring co-creation full stack at that point, now we are focusing on base open models with commercially licensed variants.

Re: Leaked deck raises questions over Stability AI’s Series A pitch to investors

#58

Post by rvz »

capableweb wrote: post #41
rvz wrote: post #31

Earlier quoted context omitted.

> There are plenty of recent examples where investors didn’t do enough due diligence in projects seeking huge valuations. Exactly. This reminds me of Fast.co [0] who recently shutdown after attempting to raise more VC capital when it was revealed that they only made 600K and with a very high burn rate. I don't see how it is so difficult for many commenters here to see that investors were mislead by the claims made by…

> that investors were mislead by the claims made by Stability.ai's IP Which claims, precisely? Could you quote these claims that were made by Stability/Emad that makes it clear they were misleading the investors? Because the article doesn't make those clear, these claims you talk about.

> Which claims, precisely?

Assuming you have read the article (and its links), there is a video podcast which he claimed that 'his team' originally developed Stable Diffusion under Stability.ai without mentioning the original researchers that created the model, until they raised money which one of the researchers clearly mentions this in the article:

> “Once he had this money he became a bit clearer who actually developed Stable Diffusion and that his company did not own the IP,” he says. “Now we come to the interesting thing — if you’re running a company that’s raising a Series A and pushing for a lot of money and your VC guys realise that you don’t own any IP, that probably makes it a bit tricky.”

So according to the leaked Telegram message, the claim of millions of people or '5M' users using Stable Diffusion (for free) and DreamStudio which that itself is a paid SaaS and now they are running out of money [0] doesn't add up or seem to be very promising to Stability either way.

Just other typical VC cash in and burn as much money as possible for inflated numbers.

[0] https://www.semafor.com/article/04/07/2023/stability-ai-is-o...

Re: Leaked deck raises questions over Stability AI’s Series A pitch to investors

#59

Post by emadm »

capableweb wrote: post #53
anonylizard wrote: post #44

Earlier quoted context omitted.

Dreamstudio is a joke, not intended to be a serious product, but merely for someone to try out SD in under a minute. 99.9% of SD usage happens outside of Dreamstudio. The power of SD comes from using fine-tuned models, and dreamstudio doesn't allow that (For copyright reasons presumably). There are websites like happyaccidents that do allow using fine-tunes, because they are willing to shoulder the massive legal risk…

As someone who develops software using Stable Diffusion and gets sold for money, I'm well aware how simple Dreamstudio is. No professional would use it. Doesn't mean they are not developing it to be a real product, that they'll try to get people to buy for real money.

The strategy was not DreamStudio but variant open models for private data.

We will be open sourcing DreamStudio shortly having refactored it.

Re: Leaked deck raises questions over Stability AI’s Series A pitch to investors

#60

Post by Barrin92 »

capableweb wrote: post #52
impulser_ wrote: post #51

Earlier quoted context omitted.

It's definitely not far fetched for VC investors to not do any due diligence at all. Obviously not all of them, but there are quite a bit of them that just gamble with their money. Just take a look at how many of them threw money at crypto lol.

Yeah, again, how many investors invested in a cryptocurrency company and then not until afterwards realized they invested into a cryptocurrency company? Because that's what the article suggests happened, which is obviously ridiculous.

>and then not until afterwards realized they invested into a cryptocurrency company?

the correct analogy here is, how many in the crypto space invested in crypto companies and didn't realize that the companies didn't actually have any original IP or product, and the answer is a ton of them

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