Sean Parker is rebuilding Stability AI around music

Sean Parker, the co-founder of Napster, has jumped back into the music industry, and this time, he tells The Information, he is "playing by the rules". He readily concedes that asking for forgiveness rather than permission did not work out so well for him last time around.

Two years ago Parker took part in an $80 million rescue of Stability AI, the image-generation startup that nearly collapsed after overspending and internal turmoil led to the ouster of founder Emad Mostaque. Now Parker and his longtime friend Prem Akkaraju, who became the company's CEO, are taking the wraps off what they have been building.

AI tools for music professionals

The big idea, Parker says, is to turn Stability into the go-to AI toolmaker for music professionals. Stability has already released three new audio models and AI music-editing software; the systems can generate entire instrumental tracks or short snippets from text prompts. Parker says an upcoming update will let users steer the model by humming a melody or beatboxing a drum pattern.

$76 million, backed by the major labels

In late August the company announced $76 million in fresh funding from backers including Sony, Warner and Universal, which also licensed their catalogs for training as part of the deal. The Series B round also included gaming publisher Electronic Arts, AMD Ventures and Pacific Alliance Ventures, and brought Stability's total fundraising to $232 million. CEO Prem Akkaraju called the funding "an affirmation of our vision where generative AI empowers every producer, musician, and storyteller."

From Napster's piracy to licensing deals

The contrast with Napster is stark. The file-sharing service was sued into a death spiral by the recording industry in the early 2000s; today three of the biggest labels are both investors in Stability and partners in its training data.

Stability, the maker of the Stable Diffusion image generator, was founded in 2019 and spent the past year signing deals to weave generative AI into entertainment companies' creative workflows. It says the new capital will go toward expanding its "creative production" product suite and its professional services arm, with music now at the center of its plans.