Stability AI CEO resigned, top staffers left

The $1 Billion AI Company Behind Stable Diffusion Is In Chaos & Staff Are Fleeing

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Stability AI, the company behind popular AI art generator Stable Diffusion, has found itself living in interesting times, after facing accusations of theft. And then its CEO, Emad Mostaque, resigned

Now, some of the company’s top developers have left to start a new AI company – Sakana AI – halfway across the world in Japan. 


Sakana AI, where several members of the founding team were previously from Stability AI. Source

How did the company, with a valuation of US$1 billion (AU$1.55 billion), get to this point? Here’s a full timeline of the drama, and what it means for Stability AI.

Stability AI: Timeline 

On March 7, 2024, Stability AI’s top competitor Midjourney accused the company of theft. How so? Midjourney had experienced a 24-hour outage due to “botnet-like activity from paid accounts”.

According to Midjourney’s announcement on Discord, the activity was “suspected to be Stability AI employees trying to grab prompts and image pairs”. In other words, Midjourney alleged that Stability AI tried to steal the company’s recipes for producing the best AI art.

It’s a “pot calling the kettle black” situation, because the business model of both companies is built on scraping artwork online from artists without their consent.

Nonetheless,  after the incident, Nick St. Pierre, creative director for OCA and a self-described Midjourney shill, said on X that all Stability AI employees were officially banned from using Midjourney. St. Pierre even taunted Stability AI’s then-CEO Mostaque: “Care to comment?” Spicy!

Less than a fortnight later (March 20) Forbes reported that three of Stability AI’s five key researchers – who helped develop Stable Diffusion – had left the company.

Robin Rombach, Andreas Blattmann and Dominik Lorenz were the three who departed, according to the Forbes story. They followed several executives, who had resigned in the previous months, raising concerns over Stability AI’s future. They included ex-chief people officer Ozden Onder and ex-chief operating officer Ren Ito.


In October 2023 Stability AI raised US$50 million (AU$76.7 million) in funding from tech giant Intel.

In November 2023 Bloomberg reported that Stability AI was racking up a US$8 million (AU$12.3 million) bill each month on wages and other expenses, 

Four months later, on March 24, Stability AI’s CEO Emad Mostaque announced his departure from the company. Mostaque said he wanted “to pursue decentralised AI”.

Stability AI… but in Japan

In January 2024 Sakana AI had raised US$30 million (AU$46 million) from investors. Part of the company’s founding team are… *drum roll* Stability AI’s former COO Ren Ito, and senior research scientists Takuya Akiba and Makoto Shing.


“Sakana AI is the escape destination for Stability AI employees,” wrote a Japanese anti-AI activist on X. 

“Fleeing to Japan, where anything related to AI seems to be legal, they are attempting to commit crimes against the world again,” added another Japanese user on X.

Stability AI has appointed COO Shan Shan Wong and CTO Christian Laforte as interim co-CEOs.