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Stability AI owed money to multiple cloud providers after defaulting on payments


Stability AI owed money multiple cloud providers

Due to financial difficulties, the generative AI startup Stability AI was unable to meet its payment obligations with cloud providers in 2018.

Forbes reports that mismanagement and skyrocketing compute costs have resulted in chaos at the former industry darling, as detailed in a detailed profile of the downfall of outgoing CEO Emad Mostaque.

According to Forbes, Stability is projected to spend $99 million on computing in 2023. However, it hasn't paid AWS for August consumption ($7 million) and is underpaying July AWS invoices by $1 million. Additionally, Stability owes $1 million to Google Cloud and $600,000 to CoreWeave. There are also debts from AWS in September and October, but the exact amount is unknown.

One of the top ten supercomputers in the world, according to Emad Mostaque, who resigned as CEO in March, was Stability's AWS cluster.

Intel said last year it would use Gaudi2 accelerators to build its own AI supercomputer with Stability as the main tenant. Intel has only spent $20 million of the expected $50 million. Stability has faced challenges with its text-to-image generator and hasn't met its commitment to create AI models for nation-states. Instead, it's considering selling its computing as another source of income.

The company's October financial report projected a revenue of $139 million in 2024, which would account for approximately 98% of its income. The report also mentioned plans to offer the endeavor as a managed services' product. Additionally, there were ongoing investigations into the possibility of leasing a cluster of Nvidia A100 chips to the venture capital company Andreessen Horowitz through CoreWeave.

A worker told Forbes that the company claimed to offer managed services but didn't actually manage anything. Another ex-employee said the company denied reselling compute, and it felt unethical. It's uncertain if Stability's contract with AWS will be affected if it resells Amazon's compute.

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