Stability AI in FREEFALL! Why Stable Diffusion 3 Weights Might Not be Released & Emad Talks

Ai Flux
16 May 202416:11

TLDRStability AI, once a pioneer in the AI revolution with its impressive model Stable Diffusion, faces financial challenges and leadership changes in 2024. Despite past achievements, the company is now struggling with profitability and is reportedly considering a sale or bankruptcy protection. Amidst these troubles, there's hope for the release of Stable Diffusion 3, with a partnership with Argmax hinting at on-device inference capabilities. The future of open-source AI models and the company's direction remain uncertain, sparking discussions within the AI community.


  • 😯 The AI Revolution in 2023 introduced powerful new capabilities, with large language models and AI advancements that were once thought impossible.
  • 🌟 Stability AI and their model, Stable Diffusion, emerged as a beacon of hope for open-source AI development, showcasing that smaller companies could compete with tech giants.
  • 💡 Stable Diffusion gained popularity for its user-friendly approach, offering fine-tuned control without restrictions on prompts or usage.
  • 🔄 However, Stability AI faced significant challenges, including profitability issues, internal disputes, and questions about copyright compliance and licensing models.
  • 💸 Financial troubles for Stability AI escalated, leading to discussions of a sale and even considering bankruptcy protection due to cash flow problems.
  • 🛠️ Despite setbacks, Stability AI continued to innovate, making progress in text-to-speech models and exploring text-to-video capabilities.
  • 🤝 A partnership with Argmax hints at the potential for on-device inference of Stable Diffusion 3, possibly on Apple's silicon devices, indicating a shift towards specialized generative AI tools.
  • 📉 The company's financial struggles were further highlighted by their inability to pay AWS bills for GPU usage, pointing to a crisis in their business model.
  • 🤔 The future of Stability AI remains uncertain, with the potential for acquisition by tech giants or smaller companies like Argmax, which could influence the direction of open-source AI models.
  • 🔮 Emad, the former CEO, has moved on to other projects, including crypto ventures, while still retaining influence over Stability AI's open-source commitments.
  • 🚀 There is optimism that despite the turmoil, the release of Stable Diffusion 3's open weights could still happen, continuing the legacy of open-source AI innovation.

Q & A

  • What was the significance of Stable Diffusion in the AI industry in 2023?

    -Stable Diffusion was significant because it demonstrated that a company without millions or billions of dollars could create a model that competes with larger companies. It also showed that sharing models and having organic results could lead to a greater sum of knowledge and progress compared to closed-source organizations like Open AI.

  • What challenges has Stability AI faced in the last six months?

    -Stability AI has faced challenges with profitability, departure of key members, allegations of financial mishandling, and questions regarding compliance with U.S. copyright law. There are also concerns about the licensing and ownership of images created by their models.

  • What is the current situation of Stability AI in terms of financial stability and leadership?

    -Stability AI is currently in a cash crunch, discussing a sale and considering bankruptcy protection due to running out of money. Emad, a key leader, has departed from major leadership roles in the company.

  • What is the potential impact of Stability AI's financial troubles on the release of Stable Diffusion 3?

    -The financial troubles might affect the release of Stable Diffusion 3, as Stability AI is struggling to maintain operations and invest in research. However, there is hope that partnerships or acquisitions could help facilitate the release.

  • What is the role of Argmax in the current situation of Stability AI?

    -Argmax has announced a partnership with Stability AI for on-device inference of Stable Diffusion 3. They are working on optimizing the model for Apple silicon devices and plan to open-source the project alongside Stability AI's upcoming open weights release.

  • What does Emad's involvement in crypto projects indicate about his current focus?

    -Emad's involvement in crypto projects indicates that he is no longer actively involved with Stability AI and is focusing on his own ventures. He has expressed interest in decentralized distribution models and blockchain technology.

  • How does the script describe the potential future of Stable Diffusion 3 if Stability AI goes under?

    -The script suggests that even if Stability AI goes under, there is a possibility that Stable Diffusion 3 could still be released through partnerships or acquisitions, such as with Argmax, which is focusing on on-device inference for the model.

  • What is the significance of the partnership between Stability AI and Argmax for the AI community?

    -The partnership is significant as it could lead to the optimization and open-sourcing of Stable Diffusion 3 for on-device inference, potentially making advanced AI capabilities more accessible on consumer devices like MacBook Pros, iPhones, and Apple Watches.

  • What are some of the concerns raised about the business model and financial management of Stability AI?

    -Concerns include the company's inability to yield a profitable business model or a way to monetize their models effectively. There are also allegations of financial mismanagement and potential fraud against Emad, the former CEO.

  • What is the potential outcome for Stability AI if they are unable to secure funding or find a buyer?

    -If Stability AI is unable to secure funding or find a buyer, they may have to file for bankruptcy protection, which could result in the dissolution of the company and the loss of one of the major sources for open-source image generation models.



🚀 The Rise and Challenges of Stability AI

This paragraph delves into the early days of the AI Revolution in 2023, highlighting the public's limited understanding of AI and the foundational algorithms dating back to the 1960s and '70s. It discusses the emergence of large language models and the significant progress made with models like Dolly 3 from Open AI and Stability AI's stable diffusion. The paragraph also touches on the challenges Stability AI faced, including profitability issues, departure of key members, and questions over copyright law compliance, culminating in the company's current financial struggles and potential bankruptcy.


📉 Stability AI's Financial Downturn and the British Startup Scene

The second paragraph focuses on the broader implications of Stability AI's financial troubles for the British startup ecosystem, contrasting with the dominance of French AI innovation in Europe. It details Stability AI's expenditure on research and training without yielding a profitable business model, and their failed attempt to mimic Mid Journey's model. The paragraph also speculates on potential buyers for Stability AI's assets, particularly the anticipated stable diffusion 3, and mentions a partnership with Argmax for on-device inference, suggesting a possible lifeline for Stability AI's flagship model.


🤔 The Future of Stability AI and Speculations on Partnerships

This paragraph explores the uncertainty surrounding Stability AI's future, including the potential for the company to be acquired or to declare bankruptcy. It discusses the company's past financial support for innovative projects and the irony of their current cash crunch. The paragraph also examines the partnership with Argmax, which aims to bring stable diffusion 3 to Apple devices, and speculates on the value of this partnership in light of Stability AI's financial woes. Additionally, it touches on Emad's involvement with crypto projects and the murkiness of the deals involving Stability AI.


🔮 The Impact of Stability AI's Situation on the Generative AI Landscape

The final paragraph reflects on the potential impact of Stability AI's situation on the generative AI industry. It raises questions about the future of open-source models and the implications for users who have relied on Stability AI's technology. The paragraph also invites viewers to share their thoughts on the matter and speculates on which direction Stability AI might take, whether it will be absorbed by tech giants or smaller companies like Argmax. It concludes by acknowledging the controversial yet significant role Stability AI has played in the AI space and the mixed reactions from the artistic community.



💡AI Revolution

The term 'AI Revolution' refers to a significant shift in technology where artificial intelligence plays a crucial role in transforming various industries and processes. In the video's context, it denotes the period in 2023 when AI started to make substantial impacts, such as improving search results and creating models that were previously thought impossible. The script mentions that during this time, large language models emerged, showcasing the potential of AI.

💡Stable Diffusion

Stable Diffusion is a model developed by Stability AI, which gained recognition for its ability to compete with larger companies despite having fewer resources. The script highlights its significance as a symbol of open-source progress and knowledge sharing, enabling users to create images without the constraints imposed by large, closed-source organizations.

💡Generative AI

Generative AI refers to artificial intelligence systems that can create new content, such as images, text, or videos, that are not simply alterations of existing data. In the script, generative AI is exemplified by Stability AI's Stable Diffusion model, which allows for the creation of unique images, and is a central theme of the video discussing the company's contributions and challenges.

💡Copyright Law

Copyright law is the legal framework that protects original works of authorship. In the context of the video, it is mentioned in relation to Stability AI and questions surrounding the legality of their operations, particularly concerning the licensing of their AI models and the ownership of images generated by these models.


Profitability is the ability of a business to generate profit from its operations. The script discusses Stability AI's challenges with profitability, which is a critical issue that contributed to the company's financial struggles and is a key factor in their current predicament.

💡On-Device Inference

On-device inference refers to the process of running AI models directly on the user's device, such as a smartphone or laptop, rather than on a remote server. The script mentions a partnership between Stability AI and Argmax, focusing on bringing Stable Diffusion 3 to devices like Macs and iPhones, which is significant for the accessibility and performance of the AI model.


MLX stands for Metal for Linux, which is Apple's framework for high-performance graphics and compute on macOS and Linux platforms. In the script, it is mentioned as part of the optimization efforts for Stable Diffusion 3 to run efficiently on Apple's silicon devices, indicating a focus on performance and compatibility with Apple's hardware.

💡Open Source

Open source refers to a model where the source code of a software is made publicly available, allowing anyone to view, modify, and distribute it. The script discusses the open-source nature of Stability AI's models, which has been a point of contention and a potential factor in their financial challenges, as well as a source of their community support.

💡Bankruptcy Protection

Bankruptcy protection is a legal status that a company may seek when it is unable to repay its debts. In the video, it is mentioned that Stability AI is considering bankruptcy protection due to their financial difficulties, which is a critical turning point for the company and its future.

💡Render Network

The Render Network is a distributed GPU cloud service mentioned in the script, which uses an Ethereum token for payment. The video discusses a potential partnership between Stability AI and the Render Network, which could provide Stability AI with a more cost-effective compute solution, given their financial constraints.

💡Crypto Projects

Crypto projects refer to initiatives related to cryptocurrencies or blockchain technology. The script mentions Emad, the former CEO of Stability AI, who is now involved in various crypto projects. This indicates a shift in focus from AI to the emerging field of digital currencies and decentralized systems.


In 2023, the AI Revolution began with large language models that were more impressive than any chatbot seen in the last decade.

Stable Diffusion by Stability AI demonstrated that a company without billions can compete with larger entities in AI model creation.

Stable Diffusion's release was the most exciting news in the AI industry, with its ability to run on various GPUs.

Stability AI faced challenges with profitability and internal disputes over financial mismanagement and alleged fraud.

Questions arose about Stability AI's adherence to US copyright law and the licensing of AI models.

Stability AI's model allows for fine-tune control without restrictions on prompts or usage, unlike some competitors.

Stability AI expanded beyond images, making progress in text-to-speech and even text-to-video models.

Stability AI once had a surplus of GPUs and funds, supporting other innovative projects in AI.

Emad, the former CEO of Stability AI, has moved on to various crypto projects while still retaining a board position at Stability AI.

Stability AI is considering bankruptcy protection and a sale due to a severe cash crunch.

Argmax, a company specializing in on-device inference for AI, has partnered with Stability AI for Stable Diffusion 3.

The partnership aims to bring Stable Diffusion 3 to Apple devices, optimizing for memory consumption and latency.

Despite financial troubles, Stability AI continues to be a significant player in the generative AI space.

The future of Stability AI and the release of Stable Diffusion 3 weights remain uncertain amidst potential acquisitions.

Imad's AMAs reveal his focus on crypto projects and a hands-off approach to Stability AI's current operations.

The Render project, a distributed GPU cloud, is speculated to be in talks with Stability AI for computational resources.

Stability AI's financial struggles highlight the risks of relying on rented GPUs for large-scale AI operations.

The community awaits the open weights release of Stable Diffusion 3 with anticipation, despite the company's challenges.