Stability AI Secures Convertible Note After Fundraising Struggle

Stability AI, the artificial intelligence startup that has been struggling to raise funding at a $4 billion valuation, secured a convertible note from investors, according to people with knowledge of the matter.

The convertible note deal, which raised less than $25 million, happened this spring after Stability AI, distributor of the Stable Diffusion image-generation tool, was said to be seeking to quadruple its valuation. Stability AI spokesman Motez Bishara denied the reporting, and said that the company has not been struggling to raise money.

“We have not been actively fundraising or launched a formal round, and have not had fundraising ...