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Reprinted from: Xinzhiyuan | Editor: Editorial Department
[Guide] "Borrow" other people's code to build a $1 billion empire?
Emad Mostaque, the founder of Stablity AI, was recently "skinned" by Forbes!
Forbes broke the news in a long article that the source code of Stable Diffusion, which made Stabiliyt AI famous, was actually written by another group of researchers.
Before the publication of Stable Diffusion, scholars from Germany and the start-up company Runway jointly launched an open source image generator called Latent Diffusion.
And Mostaque took someone else's work and wrote his name on it-this is the origin of Stable Diffusion.
After "stealing" the results of others, Emad Mostaque relied on his extraordinary verbal skills to turn Stability AI into a start-up company valued at $1 billion.
Moreover, after Forbes interviewed more than 30 people (including current employees, former employees, investors, former colleagues, etc.), and reviewed various promotional materials and internal documents, they found that he had many black spots such as falsified academic qualifications and falsified work experience. , completely exaggerated his personal role.
And this turmoil has attracted a lot of attention in the circle. Sebastian, a machine learning expert, also jumped out and said: No, no, no, there are still people who don't know that Stable Diffusion is actually based on Latent Diffusion, right? This is a boomerang.
As early as 2022 in his academic blog, he pointed out that the results of Stability AI are actually based on Latent Diffusion.
The real hero behind Stable Diffusion
In 2021, a team of researchers in Germany teamed up with the start-up company Runway to launch an open source image model called Latent Diffusion (potential diffusion).
The team of researchers includes academics from the Universities of Munich (LMU) and Heidelberg Universities, and the study was led by Prof. Björn Ommer.
According to Professor Björn Ommer, the training of Latent Diffusion only uses dozens of Nvidia GPUs.
Seven months later, in June 2022, Mostaque reached out to them, and Stability AI provided them with the supercomputing they needed.
The increase in computing power has significantly improved the performance of Latent Diffusion.
Surprisingly, in August, this new model was named Stable Diffusion and released under the name of Stability AI.
In a press release from Stability AI, Mostaque called Stable Diffusion "the most popular open source software ever created."
So, just by providing computing power, other people's results become your own?
In this regard, a former employee of Stability AI commented on Mostaque: "He is very good at taking other people's works, signing his own name, or using them to do things that cannot be verified as authentic."
Whether it is right or wrong, the outside world can't control so much.
Within days of Stable Diffusion’s release, Stability AI received $100 million in funding from two companies called Coatue and Lightspeed. This investment is 8 times the amount Mostaque raised earlier.
And this round of financing directly made the valuation of Stability AI break through 1 billion US dollars, although the company has not yet made a profit at this time.
In subsequent press releases, it was only stated that the company behind Stable Diffusion was Stability AI, without any mention of the contributions of the German team and Runway.
Professor Ommer, of course, was unwilling to do this. He hoped that his laboratory would also get publicity, but the news department of his university was on vacation at the time.
Professor Ommer said in an interview with Forbes, "As far as I know, when we released Latent Diffusion, Stability AI didn't know about it at all, and they jumped on the carriage later."
Stability spokesperson Bishara said that the company has publicly mentioned the contributions of LMU and Runway many times on its official website and Stable Diffusion's GitHub page.
(The above two are GitHub projects released by Stability AI, which are the first generation and the second generation respectively. It can be seen that the contribution of LMU counts as your win)
(It is undeniable that Stability AI did mention LMU in its announcement on August 10, 2022)
But the German team disagreed, feeling that Mostaque had misled the public in the press release.
"What I learned from that lesson is that if you have a good news department in your company, you can change the facts and reshape history at will," Professor Ommer said.
What's more, in October, Stability AI also attacked, claiming that the new version of Stable Diffusion released by Runway had stolen its intellectual property.
Cristóbal Valenzuela, the founder of Runway, could not bear to fight back: this technology is open source, and there is no possibility of copyright infringement at all.
Mostaque later withdrew the allegations, explaining to Forbes later that he was concerned that the model version of the Runway lacked guardrails.
Both Professor Ommer and Valenzuela were very disappointed with Mostaque—"They entered the field that we have studied for many years as newcomers, and turned around and had honors that should not belong to them."
Now, both Professor Ommer's laboratory and Runway have stopped cooperating with Stability AI.
Forbes long article
Stability AI became a $1 billion company with the help of a viral AI text-to-image generator and — per interviews with more than 30 people — some misleading claims from founder Emad Mostaque. Helped become a billion-dollar company and - according to interviews with more than 30 people - some misleading claims from founder Emad Mostaque.
In this skinny article, Forbes described Mostaque in a very ironic tone.
He started the contemporary renaissance and ignited the AI gold rush.
He is a holder of a Masters degree from Oxford University, an award-winning hedge fund manager, a trusted partner of the United Nations and the founder of the technology behind Stable Diffusion.
He's the face of the generative artificial intelligence wave, with dreams of changing Hollywood, democratizing education, and beating PowerPoint. He hopes to win the Nobel Peace Prize.
It can be said that in the wave of AIGC last year, the most eye-catching double stars were ChatGPT and Stable Diffusion.
According to Mostaque, it was because of its own company's Stable Diffusion, that OpenAI saw the potential of AI large models, so OpenAI followed suit and put ChatGPT on the shelves in a hurry, which detonated the ensuing wave of gold digging.
But Forbes ruthlessly picked on Mostaque: he did not get a master's degree from Oxford University, only a bachelor's degree; the hedge fund closed down after a year; the United Nations has not cooperated with him for many years; the source code of Stable Diffusion is something else Written by the team.
Nevertheless, he has achieved real success.
Last summer, Stable Diffusion was all the rage. By October, Stable Diffusion had reached 10 million daily active users.
In May of this year, the White House nominated Stabiility, along with Microsoft and Nvidia, as one of the seven leading AI developers to work with them on a federal AI security plan.
He dined with Jeff Bezos, and the retired Google founder Sergey Brin made a rare appearance at the Stability AI launch.
The vision of open source AI described by Mostaque has fascinated many technical talents. A twenty-year veteran of Adobe chose to leave to join Stability AI.
After obtaining new financing in the summer of 2022, more top talents will follow. Among the company's 140 employees, there is the vice president of research and development who was a director of NVIDIA, the head of Google Brain, and the director of Ommer Labs. Three PhD students.
Seeing this, have you discovered Huadian?
The reason why Mostaque can claim that Stable Diffusion is the result of his own company may be because of the joining of these three doctoral students.
But the time they joined was after Stable Diffusion had been released.
The work experience of Andreas Blattmann, the co-author of the Latent Diffusion paper
Forbes’ skinning of Mostaque revealed that in order to boost Stability AI’s reputation, he had carefully devised various strategies and exaggerated his role in major AI projects, while at the same time, many researchers’ contributions were erased.
In addition, he also made exaggerated descriptions of his partnerships with Amazon and the United Nations.
This has raised suspicion among some AI experts and investors.
Among some VCs, Mostaque is raising hundreds of millions of dollars in cash at a $4 billion valuation. It also claimed in October last year that the company's annual revenue had exceeded 10 million US dollars.
Mostaque's clarification
After the publication of this Forbes report, one stone caused a thousand waves.
And Mostaque also quickly accepted the interview, and said that he was "very sorry" for Forbes' report——
"Don't talk to people who ignore the facts and just want to induce readers to click."
At the same time, Mostaque also wrote a blog in response.
He said that with the growing popularity and influence of the company, it is not surprising that Forbes would write such an extremely offensive article.
Although the team spent several weeks trying to communicate with Forbes and correct the facts. But obviously, they chose to ignore the truth of the problem.
Blog address: https://emad.posthaven.com/on-setting-the-record-straight
According to Mostaque, there are countless errors and misinterpretations in this report, so clarification is needed here: (excerpt)
· Degree from Oxford University
I didn't attend commencement to receive my degree, so technically I don't have a bachelor's or master's degree.
I have currently paid £60 and will receive these degree certificates by post next month.
Educational issues can be said to be quite important. After all, if you really want to find out the fraud, the melon will be big. Not surprisingly, this is what VB asked in the interview:
VB: Are you saying that you have completed all the coursework for your master's degree, you just haven't sent a check to collect your degree certificate? Just want to clarify what you mean.
Mostaque: Yes. I didn't attend graduation, and I didn't send in forms for them to mail me my degree certificate, so I technically don't have a bachelor's degree or a master's degree.
· Stable Diffusion
We have publicly stated several times that Stability AI is a collaborator in the development of the first version of Stable Diffusion, together with LMU's Computer and Vision Learning Group and Runway.
Details of this collaboration have been shared publicly since launch on Stable Diffusion’s Github and Stability AI’s website.
In addition, three of the five authors of the paper work at Stability AI. And the best way to fix that is to keep pushing the work forward.
· Salary payment situation
We did have some deferrals in payments, but all of these were rectified quickly - I paid my staff personally, including waiting for grants from government schemes etc.
We are also paying affected employees additional wages to compensate for any inconvenience that may be incurred and to cover any related expenses they may incur, such as overdrafts, etc.
Since the end of 2021, there have been no instances of unpaid wages in normal operations. All issues were resolved quickly.
Open your mouth when you go out, and blow everything else
According to Forbes, Mostaque didn't tell the truth in terms of education.
Real version: Mostaque graduated from Oxford in 2005 with a BA.
Kouhai version: "I am a master!"
How Bishara got it right: The boss "plans" to apply, and the Oxford MA can be awarded directly to alumni without taking postgraduate courses. "No accident", the boss will be "really" a master's degree in July!
"He's really good at making up stories," said JP Smith, a fund manager from Switzerland.
At the beginning, Smith recruited Mostaque to Ecstrat as a consultant, and later Mostaque joined the Capricorn hedge fund.
Since then, Mostaque has been bragging that he helped the building to collapse, turned the tide, and saved the company that was in trouble.
But in fact, Mostaque doesn't have that much power at all.
Damon Hoff, the co-founder of Capricorn, said that Mostaque’s performance is not good at all, and this 330 million fund will be gone in 2018.
With the explosion of generative AI, Mostaque's small thoughts began to come alive again.
For a person who can deceive by making up stories, how can this outlet be missed.
Using all kinds of marketing and hyperbole, he managed to position Stability AI as one of the world's leading unicorn AI companies.
In order to achieve this goal, Mostaque began to "deceive" investors again, claiming that Stability AI is assembling one of the world's 10 largest supercomputers.
He advertises himself as the right-hand man of AI researchers, generously willing to provide funds, and lend the supercomputers that will be built in the future to AI developers to help them compete with technology giants such as Google and OpenAI.
He said the supercomputer to be built is made up of thousands of Nvidia's most advanced GPUs, bought from Amazon for 20% off.
But Bratin Saha, who works at the tech giant in Seattle, said that what Stability AI is building is not unlike any of its other clients.
Moreover, Amazon threatened Stability AI with revoking its access to Amazon GPUs.
The reason is very simple - not enough money, owed millions.
On the issue of arrears, the reporter asked Stability AI for clarification.
No way, they had to admit it.
Moreover, Mostaque's previously announced "20% off" GPU is actually a standard discount provided by Amazon to all customers who have long-term commitments to lease.
Any payment process is being managed in an orderly manner with the support of Amazon AWS, Bishara said.
In fact, Stability AI's description of the Vincent graph software Midjourney as part of its ecology, and the co-creation of the product and the organization of the user community are completely nonsense.
Midjourney founder David Holz said that Mostaque provided only a small donation, and other than that, Midjourney had nothing to do with Stability AI.
Some employees said that Mostaque boasted that he had cooperated with UNESCO, OECD, WHO, World Bank and other international institutions, but these institutions did not participate in the subsequent development of Stability AI at all.
In response to this statement, Bishara said that Mostaque did not say such a thing. But these organizations are indeed Stability AI partners.
In response to Bishara's claim, a UNESCO spokesman said the organization had nothing to do with Stability AI. Other organizations have also come forward to confirm that Mostaque is utter nonsense.
So far, Bishara can't say a word.
The company does not pay in arrears
Of course, the real news depends on the employees. Among the employees who have already left, and the employees who have not yet left, seven of them have reported to Forbes that their wages are always delayed, and there are still cases where they are not paid. Sometimes the delay is a month. .
Five internal employees also said that for such a long period from 2020 to 2023, there have been delays in wages and deferred payments.
Even the British tax agency came and threatened to seize assets if they didn't pay taxes.
Eric, a former intern, also reported the problem of salary arrears. He said, "I am still waiting for a sum of money that should have been reimbursed to me last August."
In this regard, Bishara said that this situation has improved. Since 2021, Stability AI has not recorded any non-payment of wages in the normal course of operation. However, it is not ruled out that wages are delayed due to some special "external reasons".
The above arrears of intern reimbursement, Bishara said that it is currently being checked.
It's hard to believe or disbelieve Bishara's words. However, the financial problems that have arisen cannot be concealed.
What is even more embarrassing is that, according to Forbes' transaction screenshots, tens of thousands of pounds were transferred from Stability AI's company account to Mostaque's daughter-in-law's personal account.
However, Bishara still has an argument for this. She said that the Mostaques had provided loans to the company at the beginning, so the deal was actually reasonable.
He said, "The company is improving, and the finances are following up. We have re-conducted a full reconciliation and activated a new financial team with more experience. All arrears related to the Mostaque couple have been fully settled by the end of 2022. .”
A lawyer for Mostaque's wife, Qureshi, declined to answer any questions about the deal. But they released a statement saying that Qureshi himself has been providing emotional and financial support to Mostaque's business since 2021.
Qureshi's official position in Stability AI is the head of PR, but according to employees' revelations (really pro-employees), Qureshi described his position as COO (Chief Operating Officer) in the company, even on his business card.
Not surprisingly, Bishara had something to say again.
He said that these business cards were designed for fun, and a friend wanted to use them to practice business card design skills, but he had never used them before.
You see, if you want to talk about the ability of PR, you have to look at Bishara.
At this time, another employee came to break the news. 1 current employee and 4 former employees said that Qureshi often scolded his subordinates in the company, and it was not uncommon for him to cry.
In this regard, Qureshi said that this is only because her management method is relatively straightforward. It is a pity that some people think that she is "targeting" them, and her purpose is not to make people cry.
Earlier Bishara had said that Qureshi would be leaving the company to pursue personal development and would no longer serve on the board.
Of course, this sentence still looks like fart now. In the organizational chart in early May, Qureshi is still the head of the foundation, which is equivalent to Mostaque.
Copyright issue sued
Traditionally, VCs have spent months conducting due diligence, devising market analysis, vetting founders, and communicating with clients.
Only after the process is completed can we decide whether to invest or not.
But Mostaque boldly said that it only takes 6 days for my buddy to raise 100 million yuan.
Gaurav Gupta, a partner at investment firm Lightspeed, said, "I really want to invest. We can see that this technology is really transformative, although we don't know all the use cases for this technology."
Mostaque said in an interview that Stability AI is customizing AI models for dozens of clients, but he could only name two.
One is Eros Investments, an Indian company whose media arm has been delisted from the NYSE and has been sued for misleading investors.
The second is to provide 4 million tablet computers to children in Malawi, Africa.
In terms of financial revenue, Mostaque said that the company's annualized revenue is higher than that reported by OpenAI.
But in fact, according to people familiar with the matter, Stability AI's ARR (annual recurring revenue) is less than $10 million, and it spends more than it earns.
Like many AI startups, Stability AI is burning through money and needs a lot of funding.
However, Mostaque said in January that his company had no problems raising funds.
Bishara also said that the company still has a lot of reserves.
Funding issues aside, Stability AI also faces two lawsuits related to training models in violation of copyright law.
But the company dismissed the appeal, saying it could not identify any specific instances of infringement.
References:
https://www.forbes.com/sites/kenrickcai/2023/06/04/stable-diffusion-emad-mostaque-stability-ai-exaggeration/?sh=74d8c68575c5
https://venturebeat.com/ai/stability-ceo-says-hes-sad-about-report-he-exaggerated-his-resume/
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