Stability AI CEO resigns because you’re ‘not going to beat centralized AI with more centralized AI’

Emad Mostaque, the founder and former CEO of Stability AI, has stepped down from his position as CEO and also vacated his seat on the startup’s board, marking the second major leadership change within the AI industry this week.

Stability AI, a unicorn startup with backing from prominent investors like Lightspeed Venture Partners and Coatue Management, has yet to appoint a permanent replacement for Mostaque. In the interim, the company has named its COO Shan Shan Wong and CTO Christian Laforte as co-CEOs, according to a statement released by the firm.

Mostaque’s decision to step down from Stability AI stems from his desire to pursue decentralized AI initiatives, as he expressed in various posts on X. He argued against the dominance of “centralized AI” models, advocating for more transparent and distributed governance in the field. Mostaque, who held a significant portion of controlling shares, emphasized the importance of addressing the concentration of power in AI.

The departure of Mostaque from Stability AI comes amid challenges for the startup, which has experienced significant talent loss in recent times. Reports suggest that the company was spending a substantial amount each month and struggled to secure new funding at a desired valuation.

Notably, Mostaque’s priorities seemed to have shifted over time. While previously not emphasizing revenue growth, his recent statements indicate a focus on achieving cash flow positivity and catering to enterprise adoption. Stability AI aims to capitalize on the vast market demand for open models, particularly in regulated industries and at the edge.

This development at Stability AI coincides with other significant shifts in the AI industry, such as the departure of key personnel from Inflection AI to Microsoft. These events underscore the dynamic nature of the AI landscape and the ongoing evolution of strategies within the sector.