AI startup Stability lays off 10% of staff after controversial CEO's exit: Read the full memo

🌈 Abstract

The article discusses the layoffs at the artificial intelligence startup Stability AI, which is behind the popular Stable Diffusion text-to-image model. The company has made more than 20 employees redundant, amounting to about 10% of its global headcount, in order to "right-size" the business after a period of unsustainable growth. The layoffs come after the exit of the company's controversial former CEO Emad Mostaque, who has been accused of misleading people about his credentials and the nature of a partnership with Amazon.

🙋 Q&A

[01] Layoffs at Stability AI

1. What led to the layoffs at Stability AI?

• Stability AI made more than 20 employees redundant to "right-size" the business after a period of unsustainable growth.
• The company's newly appointed co-CEOs Shan Shan Wong and Christian Laforte told employees the firm needed to "restructure parts of the business" and that the layoffs would mean "saying goodbye to some colleagues."

2. What percentage of Stability AI's global headcount was affected by the layoffs?

• The layoffs amount to about 10% of Stability AI's global headcount, which is around 200 employees according to publicly available data.

3. Which parts of the business were affected by the layoffs?

• The employees affected by the measures are mostly on the operational side of the business.

[02] Departure of former CEO Emad Mostaque

1. What led to the departure of Stability AI's former CEO Emad Mostaque?

• Mostaque's departure follows media reports throwing doubt on his credentials, including allegations that he misled people about receiving a master's degree from Oxford University and the nature of a partnership with Amazon.

2. How did Mostaque respond to the allegations?

• Mostaque said several of the Forbes' allegations were "false accusations and misrepresentations." He claimed he didn't receive his Oxford University degree because he didn't attend his graduation ceremony but had arranged to receive his degrees by post.
• Mostaque also doubled down on the deal with Amazon, describing it as a "strategic business alliance" that saw AWS build a "dedicated compute cluster" for Stability.

3. What is Stability AI's current leadership situation?

• Stability AI is still searching for a permanent CEO to fill the top leadership role after Mostaque's departure.