Co-founder of Stability AI, Worth Billions, Says He Was Tricked Into Selling Stake for $100

Stability AI is being sued by a co-founder, who claims he was deceived into selling his 15% stake in one of the hottest startups in the sector for $100 to CEO Emad Mostaque, months before the company raised millions at a $1 billion valuation. From a report: Cyrus Hodes accused Mostaque, who is also named in a lawsuit filed in a U.S. federal court on Thursday, of convincing him that Stability AI was worthless and hiding the company's work on what became the popular image generator, Stable Diffusion. Hodes, also a co-founder of blockchain AI startup AIGC Chain, said he sold his entire Stability AI stake in 2021 and 2022, after which the business raised $101 million in a seed funding round. More recently, it was seeking to raise money at a $4 billion valuation.

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