AI startup Stability lays off 10% of employees after CEO exit

107272092 1689420449514 gettyimages 1258944999 TECHNOLOGY SUMMIT

107272092 1689420449514 gettyimages 1258944999 TECHNOLOGY SUMMIT

Emad Mostaque, founder and CEO of Stability AI, spoke during the Bloomberg Technology Summit in San Francisco, California, US, on Thursday, June 22, 2023. David Paul Morris | Bloomberg | Getty Images

Beleaguered artificial intelligence startup Stability is laying off employees after the exit of its controversial former CEO Emad Mostaque. Stability, known for the Stable Diffusion text-to-image model, made more than 20 employees redundant to address unsustainable growth, according to an internal memo.

The company’s new co-CEOs Shan Shan Wong and Christian Laforte informed employees via email that restructuring was necessary, resulting in some colleagues being let go. The layoffs account for about 10% of Stability AI’s global headcount.

Last month, Stability announced Mostaque’s departure and revealed that Wong and Laforte would be taking over as co-CEOs. Mostaque’s exit follows reports raising doubts about his credentials, including allegations of misleading statements.

The company is actively searching for a permanent CEO while continuing its operations and product releases. It recently announced developer APIs for its Stable Diffusion 3 AI model.

The full memo from co-CEOs Wong and Christian Laforte details the restructuring efforts aimed at streamlining operations, reducing costs, and refocusing the business to ensure sustainability and innovation. The leadership team will address questions at the upcoming town hall meeting, emphasizing the team’s dedication and progress despite challenges.

Beleaguered artificial intelligence startup Stability AI has laid off more than 20 employees following the exit of its former controversial CEO Emad Mostaque. The layoffs were part of a restructuring effort to right-size the business after a period of unsustainable growth. The new co-CEOs, Shan Shan Wong and Christian Laforte, informed affected employees through an internal memo, stating that the layoffs were necessary to restructure parts of the business. Most of the affected employees were on the operational side of the company. Mostaque left the company to pursue decentralized AI, amid reports questioning his credentials, including misleading investors about his educational background and a partnership with Amazon. Stability AI is still in search of a permanent CEO and continues to operate normally, releasing new products like the Stable Diffusion 3 API. The company’s co-CEOs expressed gratitude for the dedication of their team and assured them of the progress being made in the right direction.

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