The AI VC community is high: only one year old Super Dark Horse raised $1.3 billion, but the big hitters only raised $25 million?

The AI investment boom continues. Today, the new financing of several popular companies in the AIGC field once again piled up official announcements! But fixed eyes, the difference between the company and the company is really a little big ah. Among them, the establishment of just over a year, only 35 employees Inflection AI to absolute dark horse posture as a “super star”, received up to 1.3 billion U.S. dollars in investment, the valuation of a breakthrough of 4 billion U.S. dollars. This round of financing is not just a lot of money, look at the list of investors is enough to make you drop your jaw.
In addition to Microsoft, Nvidia, the two AI hegemony collective support, individual investors also include: Microsoft founder Bill Gates, Google’s former CEO Eric Schmidt, LinkedIn co-founder Reid Hoffman … But on the other hand, before and Midjounery together with the AI generation of pictures in the field of the two mountains, the capital market, the super Stability AI, however, seems to be in the midst of financing difficulties. Recently, Stability AI’s scandals, executives often leave, this time only through the sale of convertible notes to raise 25 million dollars. And once with Stability AI “incompatible”, focusing on AI video generation of the popular unicorn Runway, but continue to catch up with the victory, soaring, got by Google, Nvidia led investment of $ 1.4.
1.Inflection AI: Although the company is small, giants and big boys chasing after it
Let’s take a look at Inflection AI, the biggest winner of this time. Inflection AI is a very young company, which was just founded in March last year in Palo Alto, Silicon Valley, with a total of no more than 35 employees. Although the company is small, the team is very strong, Inflection AI has three co-founders: Mustafa Suleyman, co-founder of Google DeepMind; Reid Hoffman, co-founder of LinkedIn; and Karen Simonyan, former senior researcher at DeepMind. Simonyan.
Inflection AI was founded primarily around the training and development of large language models, and just two months after its founding, it secured $225 million in Series A funding.Inflection AI launched its first product in May of this year – Pi, a ChatGPT-like chatbot, but unlike ChatGPT’s general-purpose AI positioning, Pi is positioned as an AI that serves individuals. It is mainly centered around the needs of your personal life, such as helping you organize your schedule, prepare for meetings and learn new skills, and remember conversations with you.
Pi is based on Inflection’s internal big language model. The funds raised will also be used by Inflection AI to build a supercomputer to continue the training of AI models at scale, in partnership with NVIDIA and computing infrastructure company CoreWeave. This round of funding also marks the first time that NVIDIA has appeared on Inflection AI’s list of investors. Microsoft, Bill Gates, and Eric Schmidt, for example, have been among the investors of Inflection AI since its inception. It’s worth noting that a single funding of $1.3 billion is a significant amount when looking at the entire AI space. This puts Inflection AI directly in the top five of the highest funding rounds in the entire AI space (not just AIGC), with OpenAI, Argo AI, and Cruise being the only companies with larger funding rounds. OpenAI and Anthropic, ranking third.

2. “Scandal-ridden” Stability AI, scaring away investors?
Compared to Inflection AI’s infinite splendor, Stability AI seems to be a lot more despondent recently. To say that the first fire of the AIGC, it should be the beginning of the AI graphic “burn” up, and then there is the emergence of ChatGPT will be the peak of the craze. The two startups with the most potential in the field of AI Graphics are Midjourney and Stability AI.
Unlike Midjourney, which takes the user route, Stability AI uses Stable Diffusion open-source technology to create a thriving plug-in ecosystem, and its strong customization output capability makes it the choice of more professionals. With the east wind of Stable Diffusion, last October, Stability AI received a $100 million seed round of investment led by Lightspeed, and its valuation exceeded $1 billion. Logically speaking, as a head of the star unicorn, and riding on the wave of AIGC, Stability AI’s potential should be very large, and in view of the current financing situation in the industry, it should not be a problem to raise more than a billion dollars. However, due to the recent scandals that Stability AI has been popping up frequently, it has deterred investors.
Earlier this month, Forbes published a feature article on exposing the problems behind Stability AI, including and not limited to: founder Emad Mostaque’s academic qualifications were falsified, making up that he had a master’s degree in computer science from Oxford University; bragging about exaggerating Stability AI’s business, for example, listing Amazon, the United Nations, and other organizations as “strategic partners” on multiple roadshows. Stability AI’s business is exaggerated, such as listing Amazon, the United Nations and other organizations as “strategic partners” in many roadshows, but in reality, they have not been authorized; they have repeatedly defaulted on employee wages, and the company’s internal management is chaotic. And most importantly, even its most facade product Stable Diffusion has the suspicion of plagiarism.
According to the news, the predecessor of Stable Diffusion is actually Latent Diffusion developed by the startup Runway and a group of German university researchers. due to the limited funds and arithmetic limitations at that time, Stability AI took the initiative to find the door, and positively proposed to help them to carry out model training. But after significantly improving Latent Diffusion’s performance, Stability AI quietly took Latent Diffusion for itself and began presenting it to investors under the name Stable Diffusion.
This story is long before this one, as Runway and Stability AI had a public “tussle” last year after Stability AI announced a $100 million round of funding, which resulted in a direct confrontation. Although Emad Mostaque recently responded to the questions in the article and blasted Forbes’ report, the response also indirectly admitted that the facts such as inaccurate education and exaggerated bragging. But it also puts Stability AI’s intention to seek funding at a $4 billion valuation in jeopardy once again.
Recently, multiple sources showed that Stability AI finally raised $25 million by offering convertible notes. However, this amount of money is undoubtedly a drop in the bucket for model training, which burns money like crazy. For the time being, Stability AI is still telling the public that the company is doing fine, is not short of money, and is in the process of orderly expansion. But just this week, Stability AI’s head of research, David Ha, and chief operating officer, Ren Ito, both announced they were leaving the company in another major shakeup. So whether Stability AI is in good shape or not is something only the founders know.
3.Runway: continue to focus on AI-generated video track and raise another 140 million yuan
Compared to the current situation of Stability AI, Runway, which is looking for another track after the “parting of ways”, has had a lot of good news recently. Nowadays, we all know that the original base model of Stable Diffusion was developed by Runway and some German researchers, but after Stability AI joined and participated in the training, Runway could not avoid being marginalized. After that, Runway still insisted on the AIGC field, but the segmentation from the picture to the video editing and generation of Runway provides modes including text to video, input text and pictures to turn pictures into video, and directly turn pictures into video, etc., at the same time, you can also through the text description of the video will be personalized to the style you want to customize.
Runway did a lot of the special effects in the Oscar-winning “Omniverse”, and because of Runway’s technical support, the visual effects team for “Omniverse” consisted of only five people. As a big model company, Runway’s previous financing scale is not too big. at the end of 2021, Runway completed the B round of financing of $35 million with a valuation of $200 million, and at the end of 2022, Runway completed the C round of financing of $50 million, with a valuation of $500 million. Only a few months after the last round of financing, it was revealed in early May that Runway had completed a new round of financing of $100 million. Today, there is definite news that the total amount of this round of financing should be $141 million, and the newest investors include Google, NVIDIA and Salesforce. the valuation of Runway in this round of financing reaches $1.5 billion, that is to say, in less than half a year’s time, the valuation of Runway has tripled. With news of large funding rounds and acquisitions in the AIGC space coming one after the other, the boom has yet to abate. How exactly startups that have squeezed onto the AI poker table are going to situate themselves is probably the next challenge they’ll face.

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