The AI Founder Taking Credit For Stable Diffusion’s Success Has A History Of Exaggeration | Forbes

so imagine is the founder and CEO of the AI startup stability AI he launched the company back in 2019 and he went through a couple different business ideas for it none of them really ended up generating much revenue if any and eventually Emma just kept going kept searching for a business that would work it was summer 2022 that stability really broke out had a its big sort of almost overnight viral moment and this came with the launch of the generative AI text to image generator called stable diffusion this is a model which allows you to type in a phrase anything from your imagination and can generate uh almost instantly an AI generated image I interviewed him three times once in San Francisco last October when stability had its public launch party and then again in January in San Francisco and then in London I think I picked up pretty early on that uh he's a very charming and charismatic guy and he talks a uh very large game I think compared to most uh Silicon Valley Founders he has high Ambitions and is very uh very open about sharing them and I think that's really inspired a lot of people both investors and collaborators but also you know his own employees and the general public that has gravitated towards AI so he's developed a bit of a cult following I think in a sense through that [Music] during the fact checking process we found that a lot of things that he said were just very difficult to fact check so I think this was kind of the uh the first maybe not red flag but yellow flag that set things off and made us start to have some skepticism and want to look further into the claims that he was making as we dug in further started talking to investors who had met with stability started talking to former employees we start to piece together more the facts we started to gather some documents Ahmad has at least since 2017 been claiming that uh he holds a master's degree from Oxford University in math and computer science he had this on his LinkedIn at the time the stability raised their 100 million dollars last summer that LinkedIn has since been deleted but we found further traces of that dating back to you know his past companies going back to 2017 where he claimed this Oxford degree but in reality we contacted Oxford and Oxford told us that he does not hold a master's degree he only holds a bachelor's degree [Music] I think one of the big unlocks was we got a fundraising pitch deck from Summer 2022 that had a list of I think about like 50 employees on there in one of the slides of the document and what I found was that there were many people that were listed on that slide that did not have stability on their LinkedIn I did not have any like publicly searchable connection to stability but they were on this document and one of the people uh was this person named Eric hallahan who went on the record and talked to us about his experiences at the company Eric had been an intern at the company he spoke through the chaos of the company a bit he had been slated to work 300 hours with a company over last summer and ultimately 181 of the hours he sent an invoice to stability in August and eight months later he had not heard back he had not been paid for it [Music] I contacted stabilities collaborators that uh on stable diffusion their image generator and I ended up getting in touch with the professor at the German university called Ludwig Maximilian University of Munich and turns out that this guy this professor had overseen the initial research to create the AI model that served as the basis for stable diffusion he had a lot of gripes about the way that stability had marketed itself and positioned itself as being they said in public marketing materials the company behind stable diffusion as this professor told me you know stability would sometimes take an outsized amount of credit for you know being the company behind this work and then sometimes it was only after he had reached out to the company that the company dialed it back or you know gave the university some credit one thing that was really memorable to me that he had said during the call was that uh if you have a large enough press Department then you can Rebrand history in your interests and got the impression that that's exactly how he felt about what stability had done so we also got our hands on a fundraising uh pitch decks so these are like PowerPoint presentations essentially that the company presents to investors that they hope to put money into the company it claimed that it had Partnerships with organizations including the United Nations the World Bank the World Health Organization they claimed a partnership with Amazon web services that in these slide decks they described as a strategic partnership they claimed that Amazon had supplied a vast amount of AI chips at a 80 discount to the market value when I talked to Imad in January he told me that Amazon had cut stability a very attractive deal that he said came with quote unquote certain personal guarantees when I asked him for more information about this I was sitting in the room with him as well as his wife Sarah Qureshi who was the company's head of PR at the time she shot my question down and they just would not go further on that conversation point until we changed the topic we spoke to a vice president at Amazon who said stability is in fact like any other Amazon customer when it comes to cloud computing and he shot down the notion that there was a strategic partnership it was unclear like what exactly the arrangement was and until we finally found a couple sources who are able to independently verify it turns out that stability actually was millions of dollars in debt to Amazon and that the Strategic partnership that emad had claimed was not really a special deal for stability to investors he had said that stability had as much as a 80 discount on AI chips from Amazon through this partnership but after reaching out to stability for comment they told us that this 80 discount is actually a standard discount that Amazon offers to anybody who wants to be its customer with a story like this you always want to reach out to the company to give them a chance to respond to everything that you plan to say about them in the story so we reached out to them in early may they responded to a lot of our questions but push back on certain things but I think more unusually a key element of our story is not just Ahmad the founder but that his wife Zara Qureshi who was the head of PR she also had claimed on business cards that she was the chief operating officer and we found that uh she was sitting on the company's board of directors after they obtained their 100 million dollars of VC funding [Music] Ahmad took to Twitter and he also wrote a blog post addressing some of the claims that we had made in the story I think stability has had some kind of uh skepticism from a certain portion of the AI Community I think even prior to us publishing the story some of the feedback we've gotten afterwards is just a um people being glad that this story is out there with concrete facts rather than you know being limited to hearsay and back Channel I think it really speaks to what's going on in AI right now because of how popular generative AI has been investors out here are just flocking to uh fund companies uh at very Loft evaluations throwing around tens of millions or hundreds of millions of dollars historically you know Silicon Valley investors have spent weeks if not months you know uh doing due diligence and researching a company and researching the founder and ensuring that there are no red flags and they're comfortable to invest I think the big question will be um with AI being as hypey as it is now um how mindful will investors be of Performing due diligence of taking a bit more time to check for potential red flags at a company before going in on an investment [Music] foreign foreign

Channel: Forbes

Views: 36,380

Keywords: Forbes, Forbes Media, Forbes Magazine, Forbes Digital, Business, Finance, Entrepreneurship, Technology, Investing, Personal Finance, AI, Generative AI, Emad Mostaque, San Francisco, London, Stable Diffusion, Stability AI, Open AI, Chat GPT, Ludwig Maximilian University of Munich, Björn Ommer, Zehra Qureshi, Amazon

Id: -1OfG6DaGF4

Length: 11min 14sec (674 seconds)

Published: Wed Jul 12 2023