[HN Gopher] Hugging Face raises $235M from investors including S...
___________________________________________________________________
Hugging Face raises $235M from investors including Salesforce and
Nvidia
Author : immortal3
Score : 327 points
Date : 2023-08-24 14:02 UTC (8 hours ago)
(HTM) web link (techcrunch.com)
(TXT) w3m dump (techcrunch.com)
| sleepybrett wrote:
| Hugging face is a terrible name for an ai company. Predicting it
| suffocating us all both mentally and physically?
| Apocryphon wrote:
| I like how companies are embracing branding that evokes
| cyberpunk and other genres of dystopian science fiction.
| mywacaday wrote:
| I hadn't heard of Hugging Face before and the first though that
| came to mind was the face huggers from the Alien movies
| thrillgore wrote:
| Are they gonna change licenses in the next week, too?
| kiratp wrote:
| I love Huggingface. I worry they will be the next Docker.
|
| What is the moat? "We will run your inference" can't be the
| answer.
| ramesh31 wrote:
| >What is the moat? "We will run your inference" can't be the
| answer.
|
| Network effect. It's more like a GitHub for ML.
|
| Also trust. When your business is hosting binaries, that's no
| small feat.
| CardenB wrote:
| What do people think separated GitHub from docker?
|
| Docker also had DockerHub, but it wasn't as necessary as
| GitHub and didn't catch on as well.
|
| I think HF is more like docker than GitHub. GitHub had the
| wide scope to be huge. Docker was too niche (in comparison)
| and didn't catch on so much to be necessary for every single
| project like Git did.
|
| Similarly, HF is also niche in the sense that docker is.
| There's no need to host your model on HF, it's just a
| convenience for some projects. It's effectively a package
| manager for ML models.
|
| It seems that if there's a way to make models more easily
| runnable, HF would not be necessary at all. They have a
| community there, but it's not something that can be monetized
| well.
| hereonout2 wrote:
| Dockerhub is great for sharing images with the world at
| large, much like HF is for models. But once you're at the
| point where you want to host your images / models for
| business use do you really still want them?
|
| All cloud providers seem to have an image hosting feature,
| why go through hassle of managing and paying for a docker
| hub account when you're already on AWS and can integrate
| better with ECR? The same problem exists for ML model
| hosting IMO.
|
| Github is totally different, it's a more complex and human
| proposition. For many github has replaced an entire raft of
| tools, not just code hosting.
| CardenB wrote:
| Agree, HF is more similar to docker than it is to GitHub
| ulrikhansen54 wrote:
| They also have an insane amount of traffic - very envious,
| they'll be able to capitalise on other things as soon as they
| start to build commercial products people are willing to pay
| big money for.
| politelemon wrote:
| A Hugging Swarm which then loses tech mindshare to an immensely
| complex frankensteined offering, "cogit8s".
| verdverm wrote:
| L7N already exists
| chakintosh wrote:
| HF is the literal implementation of the old idiom "During the
| gold rush, sell shovels."
| stagger87 wrote:
| I've said this on HN before, but Nvidia is the one selling
| shovels IMO.
| frozencell wrote:
| IMO HF sell tents and Nvidia sell shovels
| kordlessagain wrote:
| HF feels more like mules than tents to me.
| mousetree wrote:
| Everyone has said this
| bleuchase wrote:
| Yeah not exactly a novel hypothesis at this point. People
| have been saying that since the GPU mining heyday.
| stagger87 wrote:
| Sure, I was only arguing against the idea that HF is
| selling shovels.
| jvalencia wrote:
| From Nvidias point of view, this might be an investment in their
| own business via network effects rather than a straight up
| investment in Hugging Face. I hope so, because when the VC money
| goes, the billing will go through the roof.
| fidotron wrote:
| Exactly. At least $100M of that will go into buying nVidia
| GPUs.
|
| That kind of thing is par for the course when invested in by
| hardware companies, but it can work out very well for everyone.
| sceadu wrote:
| Complementary service to go with their main product
| mlguy123 wrote:
| throwaway since since i used to be affiliated with them.
|
| HF did an amazing job in community building, transformers library
| and being the central store for all oss models. That said they
| are ages away from PMF and just have a bunch of different
| products non of them commercially successful (services,
| autotrain, quantization, HF hub for EE, inference end points
| etc). The majority of their revenue comes from partnerships with
| SageMaker/Azure where they pay them for sending users their way
| which wouldn't continue to grow.
|
| While it's always a possibility for a FANG company to buy them
| IMO they are completely screwed. At a $4.5B valuation they will
| have to reach at minimum $250m in ARR to IPO and at the moment
| they're probably stuck at around $25m ARR.
| covi wrote:
| https://www.forbes.com/sites/alexkonrad/2023/07/13/ai-startu...
|
| > Its revenue run rate has spiked this year and now sits at
| around $30 million to $50 million, three sources said -- with
| one noting that it had more that tripled compared to the start
| of the year.
| m_ke wrote:
| Yeah that was my concern as well. I used to work for an AI
| company that ended up in the same predicament, they raised way
| too much money at a high valuation and in the process cut down
| the potential acquirer pool to 3-4 companies. They are now a
| zombie with worthless common shares, no shot at an acquisition
| and nowhere near enough revenue to go public.
| PeterisP wrote:
| I wouldn't be surprised if they would eventually get acquihired
| by nVidia. Simply providing all that code and infrastructure to
| the community is a big boon to raise the value and sales of
| nVidia hardware; the classic strategy principle - commoditize
| your complements.
| throwaway644788 wrote:
| Throwaway for a similar reason.
|
| I can't for the life of me understand the strategy that Clem
| and team have, other than raise as much money as possible just
| because they can. My experience with their sales teams was just
| absolutely awful, and it gave me no hope that they can grow ARR
| as soon as they need to. We practically begged them to sell us
| something, but it wasn't until we went elsewhere definitively
| that they seemed interested.
| version_five wrote:
| I wonder if they, intentionally or inadvertently, have
| optimized for investment scale at the expense of everything
| else? There is a market demand for "pure" AI startups that
| can take 9 figure investments. It's (comparatively) "easy" to
| optimize to be that company, but extremely hard to find a way
| to live up to the hype and provide a return in the
| investments, and this strategy often ruins the company.
| asadm wrote:
| They will be acquired. Either by Google or MS.
| alberth wrote:
| MS has already invested $10B in OpenAI, so they aren't going
| to be a buyer.
|
| Google has poured hundreds of million into Anthropic due to
| Eric Schmidt, so they aren't going to be a buyer.
| brucethemoose2 wrote:
| Meta?
| [deleted]
| asadm wrote:
| Both Anthropic and OpenAI are not a replacement for
| huggingface. Which has complete monopoly on model hosting
| right now.
| biztos wrote:
| Why Google (who has their own AI stuff) or MS (who has a hand
| in OpenAI) and not, say, Samsung?
| claytonjy wrote:
| Branding and trust. ML folks love HF, and rightly so. They
| have great software libraries, host everyone's models,
| generally great UX all around. They do a great job of
| making it easy to do cutting edge stuff, while still making
| it possible to do bleeding edge stuff. They appeal to
| basically all ML folks in a way few other companies do.
|
| Google could grow GCP by more deeply integrating HF into
| GCP, I think, while retaining as much of the HF brand and
| interface as possible.
|
| Big friction point might be ethics, since HF is still seen
| as the "good guys" and where some folks who left Google
| over ethical concerns landed.
| m_ke wrote:
| MS makes sense since they could integrate it with github
| and azure into an ML platform that they could sell to their
| enterprise consumer base. It would also be a great addition
| to teams, bing and word suite.
| thunkshift1 wrote:
| Why salesforce?? It seems the want in on everything fancy in the
| market (looking at slack)
| dbish wrote:
| They have a VC arm that just looks for and does investments
| which doesn't necessarily means salesforce proper is interested
| in the tech (though I'm sure there is some of that), kind of
| like Google Ventures.
| nytesky wrote:
| I saw this and thought it was a startup in homage to a xenomorph
| facehugger. Ironic, since we are worried about AI destroying
| humanity.
| QuadrupleA wrote:
| Hugging Face is early in the Silicon Valley enshittification
| cycle - currently burning VC money being incredibly good to it's
| users. Next would be shifting that value to its business
| customers. Then clawing back and squeezing as much value as
| possible from those. Then collapse.
|
| Although, is it technically a platform / marketplace?
|
| Anyway for now, enjoy the free beer from the VCs.
| shmatt wrote:
| enshittification is such nonsense. the original article gives
| Facebook, TikTok, Amazon and other super successful super
| profitable companies as an example
|
| "Then collapse" - nope, then generate tens of billions of
| profit per quarter. Im sure the people of Hugging Face would
| love that
| claytonjy wrote:
| "enshittification" doesn't refer to a change in _investor_
| value, but to _user_ value. Facebook does make a ton of
| money, but at the expense of the user experience. They got
| huge by providing a great UX and making no money; it was the
| need to make money that triggered enshittification.
| version_five wrote:
| They represent a real risk to the AI ecosystem IMO (or
| opportunity if you're an investor). They have really cornered
| the market on model hosting as well as frameworks for running
| them, it's going to get ugly when they start turning the
| screws.
|
| I think it's important for people to diversify away from them
| and not build anything that uniquely depends on them. It's not
| good to have chokepoints like this.
| brucethemoose2 wrote:
| Basically all the HF code is Apache and open source.
|
| Model hosting is a nice convenience, but if HF removed every
| single repo from GitHub tomorrow and paywalled the model
| repo, it wouldn't be a big deal. Maintainers would clone
| their models and repos to somewhere else.
| vl wrote:
| When I use HF to get some base model I always make sure I
| have local copy and then load from the local copy. I push
| said copy into (remote, obviously) git for the eventuality of
| HF going down/model being removed.
| htrp wrote:
| Do they really? As far as I can tell, diffusers/transformer
| are open sourced wrappers around torch implementations, there
| are a bunch of companies that are offering inference (just
| like they are), and there is some value in offering S3
| storage to allow for model search.
|
| If they reach a point where they actively become community-
| hostile, someone will just fork their codebase and release a
| web app called "FaceHugger"
| version_five wrote:
| They have this "accelerate" framework they push too:
| https://huggingface.co/docs/accelerate/index
|
| I don't know much about it, and I think (but couldn't
| quickly confirm) it's open source, so your point about a
| fork still stands, although I don't think that solves
| everything. If it did, people wouldn't care that e.g.
| Hashicorp changed their license away from open source.
| jeroenhd wrote:
| Their Git LFS based hosting is used by a lot of AI tools.
| Huggingface level data storage and transfer would also be
| VERY costly to accomplish for a small party. Some of these
| models are several gigabytes in size and downloaded
| hundreds or thousands of time per day.
|
| What they do isn't too hard to replicate, but the price for
| which they do it is impossible to compete with.
| lsmeducation wrote:
| Lol, I'm sorry what? Has anyone heard of BitTorrent or
| piracy in general? You're telling me AI models/data are
| too big?
|
| Someone utilize p2p for the love of god. Pretty sure
| there's gigabytes of porn moving (freely) through the
| internet millions of times per day.
| esafak wrote:
| GitTorrent came and went.
| jeroenhd wrote:
| Some models are distributed P2P. They download slower, in
| my experience, and require special software rather than
| the usual git commands.
|
| P2P model distribution isn't impossible, but it's a lot
| less interesting to many people, or they would've already
| spread their models through torrents in the first place.
| brucethemoose2 wrote:
| CivitAI has somehow managed this over in Stable Diffusion
| land.
|
| In fact, I think the whole community is HF averse. The
| two most popular frameworks are based around the
| Stability implemenetaion and file format, not HF
| diffusers.
| osanseviero wrote:
| FYI the file format, safetensors, was proposed, developed
| and maintained by HF, and involved people from groups
| such as Eleuther and Stability for external security
| audits.
|
| https://github.com/huggingface/safetensors
| https://huggingface.co/blog/safetensors-security-audit
| version_five wrote:
| Any sense of why they are HF averse?
| brucethemoose2 wrote:
| I'm not even sure its deliberate.
|
| Automatic1111 and ComfyUI implemented the SAI
| backend/format in the early days because thats _all there
| was_ , and now they are stuck with it. The intertia is
| tremendous.
| IKantRead wrote:
| I think they're HF averse because HF is fairly anti-NSFW
| content and it's pretty clear that civit.ai has a fairly
| large NFSW focused audience.
|
| On top of that HF _is_ just hard to use for your average
| user. Civit.ai is just "click to download" while HF is
| "look here's a broken model card... you can figure it out
| from here".
|
| Despite the cute logo, I think most people find that HF
| comes across as fairly anti-user. Despite having years
| doing ML related work, I still find HF a bit byzantine to
| navigate.
| dragonwriter wrote:
| > Any sense of why they are HF averse?
|
| Technology-wise, path dependency from stuff that was
| built out before HF diffusers were available, and on
| which more continues to be built in the ecosystem.
|
| If you are doing a greenfield project that is mostly
| standalone, its not an issue, but for existing popular
| projects and the communities of satellite projects around
| them, the switching cost is high.
|
| In terms of content hosting, well, a fair amount is
| hosted on HF, but there is a difference of content focus
| between CivitAI and HF, and a lot of what CivitAI hosts
| HF probably wouldn't want to. Also, CivitAI has a UI
| focused on the narrow space of imagegen, whereas HF is
| more general.
| htrp wrote:
| If Amazon/Google/Microsoft wanted to own that space, they
| could do it in a heartbeat.
|
| Rumor has it Github is actively working on something
| similar to HF Hub already
| mistrial9 wrote:
| agile ; community-minded ; efficient
|
| pick one if you are lucky. Those Fortune-12 giants can't
| do anything "in a heartbeat" .. listen to what that
| means.. nonsense
| forgingahead wrote:
| I've seen some repos on Github host the models on
| "Releases". Not sure how viable that is long term, but
| definitely easier to download and access than some random
| Google Drive link which is typical for a lot of other
| repos.
| 0xcde4c3db wrote:
| Diversify to what, though? The economics of hosting models
| and datasets seem to just not be great in general. For the
| same reasons that we can expect HF to eventually crack down
| on the "freeloaders", I think pretty much any other entity
| also will unless it's explicitly set up as a public benefit.
| I could see this sort of thing maybe being funded by
| universities or their affiliated foundations, but most
| companies with the resources to provide this kind of hosting
| also have a pretty strong incentive to extract revenue from
| it.
| michaelt wrote:
| Pip, maven, npm, docker hub, apt-get, github and suchlike
| seem to manage to provide hefty binary downloads with no
| need to monetise anonymous downloads.
|
| I don't quite understand _how_ they do so, but it seems to
| be possible. Everyone who downloads a 5GB stable diffusion
| model probably downloaded 5GB of pytorch+cuda+cudnn first.
| Lord_Zero wrote:
| Back in the day, universities would host all that shit
| via their mirrors for free for everyone. Not sure where
| it all is today with the cloud being so prevalent.
| zo1 wrote:
| You don't even hear the term mirror anymore.
| basilgohar wrote:
| Linux distros still have large networks of mirrors for
| downloading their releases and also packaged binary
| updates. Maybe we don't "hear" the term but they are
| still there.
| outside1234 wrote:
| We call them CDNs now :)
| bpiche wrote:
| Spacy hosts them too, of course.
|
| python -m spacy download en-core-web-lg
|
| etc
| brucethemoose2 wrote:
| > 5GB of pytorch+cuda+cudnn
|
| This itself is kinda insane. In fact, it was literally
| untenable for PyPi, which is why (historically)
| installing all that was unecessarily painful.
| 0xcde4c3db wrote:
| For its part, PyPI is apparently funded by the Python
| Software Foundation and run by volunteer admins, with the
| bulk of its data served gratis by Fastly. This is based
| on a blog post about its infrastructure from 2021 [1],
| which also says that the list price for the throughput
| they're doing is $1.8 million per month.
|
| [1] https://dustingram.com/articles/2021/04/14/powering-
| the-pyth...
| bakuninsbart wrote:
| You can replace this with "container" and "docker", and it
| turned out exactly or similar to how you predict. However,
| there is nothing with a big moat that Huggingface is
| offering. If they overeshittify, competitors will rise up.
| foooorsyth wrote:
| >there is nothing with a big moat that Huggingface is
| offering
|
| There are network effects in play here. They have a big
| moat purely because of their large user base.
| pradn wrote:
| Late in the "enshittification cycle", competitors do rise,
| but they're usually under-resourced. So you get a overly-
| monetized primary product and a bunch of "never quite
| there" competitors. That's overall worse than at the
| primary product's "free beer" phase.
| amelius wrote:
| When it comes to that we'll use AI to migrate everything over
| :)
| amelius wrote:
| It's always the same with these f'ing marketplaces/platforms.
| There should be new laws for crowdsourced value.
| [deleted]
| 2OEH8eoCRo0 wrote:
| > enjoy the free beer from the VCs.
|
| Careful not to become dependent on the free beer.
| iambateman wrote:
| Maybe? Probably? Probably.
|
| As a counter point, GitHub has remained great for longer than
| expected, and has arguably improved since being bought by
| Microsoft.
|
| One can hope that their example will help set the expectation
| for other platforms like HF
| SkyMarshal wrote:
| It seems the enshittification cycle may have resulted at least
| in part from the Blitzscaling methodology [1]. Are there any
| studies on the effectiveness of Blitzscaling in general? I
| wonder if it's a net success or not.
|
| [1]:https://www.blitzscaling.com/
| judge2020 wrote:
| It'll go the same route as Docker. Anyone relying on it for
| critical software will pay, everyone else will use alternative
| but compatible sources once it's no longer free.
| no_wizard wrote:
| I think with Docker's recent pivots, its clear that they
| thought they were going to be _the_ container company, but
| Swarm never caught on, and Dockerhub never really evolved
| beyond hosting images (though, its verified images feature is
| nice).
|
| What Docker ended up accelerating at is reproducible
| development environments that tear down and spin up easily. I
| think this is the largest faction of docker users.
|
| It never translated into a high volume of Docker Swarm and
| related sell through features materializing though.
|
| That's what a swath of all their new paid features are
| focused on enterprise things like SSO, auditing etc.
|
| For Hugging Face, they will need to have a compelling set of
| features that make it either hard to migrate off of or vastly
| preferable to other options the majority of the time.
|
| Right now, their most compelling feature is being (mostly)
| free
| taminka wrote:
| i'm curious what HF does, because iiuc they're mostly just
| hosting model files? i know that they have some compute offers,
| and also created/maintain a few libraries, but it's not
| particularly widely used, i'm really not sure how they're
| supposed to earn money...
| hereonout2 wrote:
| I've been asking myself that for a while. Would they be so
| popular if they didn't host & serve petabytes of model files
| for free? How will they monetize that aspect to match this
| valuation?
|
| Whilst the scale of their model hosting is impressive, the
| functionality seems pretty basic. The models are just BLOBs
| in git LFS repos, you're usually relying on knowing which
| users to follow, then learning the way they name their models
| and how that naming convention applies to the particular
| framework and hardware you're using.
|
| As an example the user "TheBloke" is prolific at publishing
| LLM models for various hardware / framework combos, but look
| how little the HF interface actually helps navigate or find
| what you're after: https://huggingface.co/TheBloke
|
| Also, is anybody using HF Hub in "production"? We've deployed
| a few LLMs now and once we've decided on a model the first
| thing we do is get it off HF and into our own storage ready
| for deployment. There seems no reason to tightly integrate HF
| Hub with production systems given it's a just a bunch of
| files you can copy and keep.
| ladberg wrote:
| I think their "spaces" (i.e. running tons of models for free
| with a nice UI) are widely used.
| ShamelessC wrote:
| Those are pretty lackluster in my experience. Do they even
| support GPUs? And in any case, it seems like they go down
| for anything sufficiently popular.
| dbish wrote:
| This isn't sustainable though. Compute is expensive, maybe
| they'll end up with paid plans for anyone trying to use a
| space
| jsemrau wrote:
| That should be inversely related to their usage though. I
| am using HF frequently, but I am not sure if I would pay
| for it.
| dbish wrote:
| That is the issue for sure
| myth_drannon wrote:
| It is also used for discovery and search of models. Following
| your train of thought, Github is just hosting a bunch of src
| files.
| NelsonMinar wrote:
| Yeah, enjoy the free beer and have a plan to take a case with
| you when the bar is closing.
| cloogshicer wrote:
| Unless the bar gets so big that all the other bars go out of
| business like with YouTube and many other
| monopolies/oligopolies.
| echelon wrote:
| GitHub is pretty excellent.
| nkingsy wrote:
| It's a loss leader so msft can point to something when
| you complain about the abusive hellscape that is modern
| windows.
| esafak wrote:
| Works for me; I don't really use Windows. Also GitHub is
| paid so it does not have to be a loss leader.
| Palmik wrote:
| According to Clement (the HF CEO) they are close to covering
| their costs, and have 10years runway:
| https://twitter.com/ClementDelangue/status/16947653579682861...
| version_five wrote:
| Can someone who knows the VC industry explain why having 10
| years runway would be considered good? Aren't these companies
| supposed to be deploying capital as quickly as possible, not
| banking it. If a ceo said they needed your money 5+ years
| from now, wouldn't you wait until then to commit?
| jasonwatkinspdx wrote:
| FOMO is a thing among VCs. You may not be let in the round
| 5 years from now, or the price may be less favorable, etc.
| stevofolife wrote:
| Someone who knows the VC industry should chime in on this -
| but AFAIK, companies don't get all their money from
| investor at once.
| echelon wrote:
| > If a ceo said they needed your money 5+ years from now,
| wouldn't you wait until then to commit?
|
| Why would a CEO give up equity if they don't need the
| capital? Wouldn't they prefer not to sell big chunks of
| flesh?
|
| If he's not deploying it now, maybe the CEO is predicting
| rough times ahead and wants to de-risk for future cash flow
| or fundraising turbulence? Isn't that, too, a kind of
| negative signal? Or is this all prudent?
| ZephyrBlu wrote:
| _Currently_ 10 years of runway. I wouldn 't expect them to
| maintain that for a significant period of time.
| mlguy123 wrote:
| Notice the choice of words: " _Most_ of our OSS and free
| usage cost ". Who knows what's omitted from that. Also
| assuming they have zero money left in the bank from the prev
| round (they def didn't) they're losing/burning $2mm a month
| AdmiralAsshat wrote:
| Really, throughout the entire funding process no one raised the
| similarity of "Hugging Face" to "Face-huggers", the larval name
| for the Xenomorphs from _Alien_?
| mistrial9 wrote:
| except that it is literally named for a friendly and non-
| offensive chat signal.
| glompers wrote:
| There is that.
| julien_c wrote:
| we have a secret plan to change our logo to a Face Hugger some
| time in the future :)
| waterheater wrote:
| The real question is why the company doesn't use .ml as a domain
| name alias.
|
| Edit: dang, guess HN strips out emojis from posts. The Punycode
| version of the Hugging Face emoji on a relevant TLD supporting
| emoji domains would be http://xn--zp9h.ml/
| weego wrote:
| I don't know what this could ever do that isn't easily
| reproducible with a tiny fraction of that investment.
| Fragmentation of communities is an absolute given in software.
|
| Added to the fact that of they get too dominant they'll get
| leveraged out of the supply chain and I'm not sure what the value
| proposition is here.
|
| I mean obviously I'll be wrong but it's hard to not be skeptical
| warthog wrote:
| It is crazy to me that it is still 100x the ARR at this stage. I
| think for Deel, it as around 12x
| toomuchtodo wrote:
| Buying a lottery ticket is buying a dream. You too can raise
| like this if you sell a dream to people with deep pockets who
| will only be mildly perturbed when it goes bust.
| immortal3 wrote:
| To add further, i do not know what is end goal of hugging face.
| 1. They have inference API but all cloud provider can implement
| those in next year. 2. They offer subscription but market-size
| of subscription is questionable. 3. I hope this new set of
| funding don't bring problem to them because making money with
| open source is hard and at this scale of funding it might be
| even harder. It see what happens in next set of years.
| pizzafeelsright wrote:
| 1. Raise $$$ 3. Spend $$$ 4. Exit w/ $
| nytesky wrote:
| Take money off the table, that's what all the startup gurus
| call it, but whose money is kinda the question. Have
| pension funds stopped chasing VC funds etc?
| PeterisP wrote:
| The article is quite clear on whose money it is -
| "Google, Amazon, Nvidia, Intel, AMD, Qualcomm, IBM,
| Salesforce and Sound Ventures".
|
| For at least half of them, it might make sense to simply
| sponsor accelerating worldwide new AI product development
| because those new products will increase sales of their
| hardware and services; pitch in $20m together with others
| to support efforts like Huggingface, while expecting that
| their tools will indirectly cause an extra $1b sales for
| you in the next few years.
| smcleod wrote:
| The companies that invest have products (or have other
| investments with products) that have a strong market -
| they end up increasing the price of products to cover the
| purchase of acquisitions and losses. This results in
| inflation and worsening wealth distribution.
| smcleod wrote:
| Probably the same as most privately funded tech startups 1)
| Gain user base 2) Take investment funding 3) Sell and make
| the people at the top rich 4) Repeat.
| stevenae wrote:
| I suppose the argument would be switching costs -- what stops
| any cloud provider from being interchangeable with another?
| JumpCrisscross wrote:
| GitHub for ML models? If they can anchor themselves to the
| open-source developer network, their acquisition value is in
| a tech giant being able to cross-sell to that community.
| verdverm wrote:
| Are they going to spend that money recreating Code Host
| features like PRs, code scanning, CI?
|
| I'm not going to host my code on multiple platforms, pretty
| easy to make a model available for download with S3
| solarkraft wrote:
| Oh. When I last read about it I thought it was meant to be
| sustainable.
|
| I hope the founders take their share home and have fun burning
| the rest. At least hopefully some open software/AI models will
| have come out of it when the company collapses under its own
| weight.
| jedberg wrote:
| I love when Nvidia invests in AI companies. They know that money
| is coming right back to them. It's basically just a loan to the
| company in exchange for potential upside of them doing something
| with Nvidia's chips. :)
| mmaunder wrote:
| Interesting situation with public markets funding Nvidia which
| is investing in its own customers, driving further strong
| financial results driving further public investment. A high
| risk high reward play. Nvidia is eating AI.
| MasterScrat wrote:
| > They know that money is coming right back to them.
|
| Oh I assumed they were directly delivering them truckful of
| A100s? do they actually still bother with cash? ;-)
| stevofolife wrote:
| Exactly and it would be extremely stupid for them not to take
| advantage of their current market position. It's a now or never
| situation IMO.
| 1letterunixname wrote:
| Nvidia is likely to have a $36-40 B revenue year this year and
| next because of massive customer investments. Meta is spending
| $8 B on their gear and about the same next year.
| OpenAI+Microsoft are likely following suit with several billion
| in server buildout. I'm curious if Google or Apple will be
| adding large swaths of AI boxes to their fleet too.
| hackernewds wrote:
| Ridiculous. This implies infinite supply. Neither the supply
| chain, nor nature is designed to churn out GPUs like this.
| That $ will take time to be captured.
| riku_iki wrote:
| > They know that money is coming right back to them.
|
| it is totally can be condition of investment round: have
| specific vendor as compute provider.
| jedberg wrote:
| It could be, but I'm guessing they don't even have to.
| fidotron wrote:
| ML models are the new apps. There is a huge opening for an App
| Store type situation which enables people to buy models and
| integrate them into their products, handling the appropriate
| licensing.
|
| Bonus points for certifying the models actually do what they say.
| That by itself will probably become a mini industry.
|
| Hugging Face are the clear leaders in terms of having mindshare
| in the community to be able to build it.
| dbish wrote:
| Models != apps, they're closer to the backend for apps or a
| core library, so your customers aren't "everyone with a
| phone/computer" like an app, it's the much smaller, but
| potentially high impact, "everyone who creates apps".
|
| We're not in a world where non tech people are searching for
| models in the model store from their phone.
| fidotron wrote:
| We are already in a world where "artists" are exchanging
| models online based on their ability to generate certain
| outputs.
| dbish wrote:
| Do you put artists in quotes for anyone who uses a computer
| for their art at all? Are photographers artists in your
| opinion?
| fidotron wrote:
| Because of what many of the most popular models are
| actually for.
| steno132 wrote:
| Congratulations! Elon's team over at X.ai, who I'm helping
| advise, is choosing between Hugging Face and a locally hosted
| alternative.
|
| What would HN recommend? I prefer Hugging Face as it has a
| stronger community built in but others prefer a open source
| project we can customize.
| jprd wrote:
| Goodness, good luck and congrats!
|
| I am curious however, why name drop Elon and X.ai when asking
| this question?
|
| With all due respect, I'm not sure how that is going to advance
| the technical conversation, and in some regards may indeed de-
| rail it and hinder the mentoring you might receive?
|
| I hope I do not sound combative!
|
| I am generally curious, as I see this behavior at $JOB, but in
| reverse. "My customer is seeing this." "I have a customer that
| is asking Y."
|
| I am generally curious on the different perspectives that
| teammates can come from, that can drive them to take wildly
| non-congruent approaches, even with similar career experiences.
| brucethemoose2 wrote:
| Why not both?
|
| Y'all could host models on HF, and use the HF format/download
| code (which is quite good).
|
| But make a pretty frontend for it.
|
| Down the road you could just host your own backend implementing
| the HF API, if such a thing is necessary.
| espadrine wrote:
| What does X.ai seek: democratization or centralization?
|
| If it wants everyone to fork its models, having the model on
| Huggingface and using its libraries will increase adoption, as
| people are used to that format, having the quantization built-
| in, etc. Having to perform model conversions slows things down,
| despite TheBloke's constant efforts to convert every format to
| every other.
|
| If the model will only be accessible through CLI, APIs, or a
| website UI, then custom can make sense.
| dbish wrote:
| If you're hosting for your own use, unclear why you wouldn't
| just do that directly on cloud instances. If you're trying to
| share models with others publicly, then HF is the best option
| right now.
| solarkraft wrote:
| 1) What do they want with all that money?
|
| 2) How in the world are they going to pay it back?
|
| They better have a damn good idea because this seems like a good
| recipe for popping like a balloon.
| orwin wrote:
| It's not a loan, they're selling shares.
| dbish wrote:
| There is expectation you return value though. I think that's
| what most people mean when saying "pay it back" regarding
| investments like this.
| stevofolife wrote:
| Welcome to VC 101:
|
| 1) Grow 2) They don't. It's not a loan. VC world doesn't
| operate on loans. You go to the bank for that.
| ineedtocall wrote:
| I'm waiting on something like gumroad, but for curated models and
| datasets.
| alberth wrote:
| Genuine question ... What business are you in when selling AI/ML?
|
| I'm far from being knowledgeable in this space, but it seems like
| AI/ML "is a feature, not a product".
|
| And if that's the case, what business are you in when a company
| sells AI/ML?
|
| Are you in the business of licensing the model you created?
| Charging for the output? Hosting infrastructure? What exactly are
| you in the business to sell?
|
| To use an analogy, if you're selling AI/ML, are you in the IaaS
| industry, PaaS industry, SaaS industry (or something else?)
| nemo44x wrote:
| They are selling picks and shovels. There will be a few huge
| winners in the AI space, a good amount of modest winners, and a
| lot of losers. They don't care who wins or loses but are happy
| to sell the supplies needed for anyone that wants to take a
| shot.
|
| If they can make it easier and worthwhile to use their product
| and create business value, then they will sell a lot of picks
| and shovels.
| alberth wrote:
| Picks and shovels are tools.
|
| But what "tools" are being sold for AI/ML?
|
| - A model isn't a tool, that's a purpose built offering that
| can be used for 1 use case. Tools are by definition, intended
| to help with broad/general use cases.
|
| - Hosting isn't a tool, it's a commodity and lots of cloud
| players already occupy that space.
|
| Please don't take my comments as trolling, I just geninuely
| don't understand what exactly is being sold that is new or
| unique that doesn't already exist.
| nemo44x wrote:
| They have a suite of software you can use to power your own
| software. These are tools and no different than what
| database vendors, etc in terms of being software you use to
| build software. In addition there's support and services.
|
| I imagine they have big plans on how to expand and grow the
| business.
| 1letterunixname wrote:
| Yep. Meta is spending $22 B on CapEx over 2 years without any
| plan of how to use it, with about half of it tied to buying
| shit tons of H100 to go in custom servers.
| version_five wrote:
| I agree and so far I think it's picks and shovels all the way
| down. Most of the "AI" companies I see sell tooling, often to
| "help your AI team work faster|better|spend less time doing
| x|whatever. It all presupposes there are end uses, which are
| few and far between, certainly almost none are being sold. AI
| is still in the hype mode of companies having internal budget
| to "invest in AI" and so that's who the AI companies are
| targeting, as opposed to actually making products that do
| something. See also blockchain wallet companies.
|
| PS - I'm optimistic about AI, but it's important to be
| realistic about the current state of the industry
| nemo44x wrote:
| Indeed, lots of tooling out there. Which makes sense as
| it's very early days. I imagine that LLM AI will be
| integrated into so many things down the road though that it
| will be an expected feature of most any product.
| calebkaiser wrote:
| It's important to note that despite the recent excitement
| about LLMs, which is still an emerging technology, "AI" is
| not a new market by any means, nor are major companies only
| now investing in it. For the better part of a decade, ML
| has been widely adopted across industries, and the average
| person uses an "AI" system many times in a given day.
|
| For example, if you open the home screen on the average
| smartphone right now, you'll see apps like:
|
| - Delivery apps like Uber, Lyft, etc., whose
| recommendations, ETA predictions, driver matching, and more
| are built on ML.
|
| - Media apps like YouTube, Netflix, etc., all of whom rely
| on models for recommendations.
|
| - Email apps like Gmail, whose filtering (both spam and
| categorization) and text completion are based on ML.
|
| - Photo apps like Instagram, Snapchat, and even your
| phone's basic Camera app, all of which use computer vision.
|
| If you Google anything, you're perusing the output of a
| model. If you're being recommended something on basically
| any platform, you're interacting with ML. If you ever use
| speech-to-text, you're using a neural network. Your bank
| uses ML for fraud detection, your posts on social media are
| moderated by ML-based content moderation, and if you have a
| car with any recent-ish sort of lane departure assistance,
| you're driving with help from a neural network.
|
| Most of these companies have large, mature ML teams, whose
| outputs represent massive amounts of revenue. Hence, they
| represent a legitimate market for selling picks and
| shovels.
| version_five wrote:
| That's the framing we've been using for years, look at
| some big tech ML or data science that we reframed as AI,
| your manufacturer/transportation/retail/whatever company
| needs it too, but there are no products for end uses in
| your industry, just lots of tooling and consulting
| services you can buy for bespoke projects.
| lsmeducation wrote:
| [flagged]
| tilne wrote:
| Aren't you in all of those?
|
| The further you keep the user away from training and hosting,
| the less you're in those businesses. But I would think it's
| only economical to do that if you have some type of advantage
| in implementing the things you're abstracting away.
| traveler1 wrote:
| I think the opposite may be true. If you control the training
| and hosting, surely that means you have to be more involved
| in many industries to make the product useful? Whereas with
| offloading training/tuning to the user, you kinda just become
| PaaS, in that you provide a platform which enables others.
| PeterisP wrote:
| I believe that some of the most valuable short-term use cases
| for AI/ML seem to be "feature, not a product" - this means that
| the incumbents making various products can unlock lots of
| competitive value by adding those features in a way that is
| difficult for newcomers, because they not only need to develop
| the AI/ML feature but also have to build a competitive solution
| for the core system which generates or contains the data on
| which the feature relies.
|
| Like, it's plausible that many organizations would be willing
| to pay lots of money for a "ChatGPT which knows my internal
| documents" AI/ML feature for the Sharepoint/Confluence/etc they
| are currently using, but a would be very wary of migrating
| those internal documents to some upcoming startups' new
| document management system.
| stevofolife wrote:
| To be fair, I don't think there are clear dichotomies in this
| space. It really has the potential to be a feature or a product
| in either of the IaaS/PaaS/SaaS industry.
|
| Just do a quick HN search on companies selling AI/ML, you will
| see what I mean.
| emmender1 wrote:
| you are:
|
| a) a hardware vendor nvidia/amd whose products are needed by
| anyone in the game
|
| b) you have a captive customer base already ( microsoft,
| salesforce, servicenow, adobe) to whom you can sell ai/ml value
| adds
|
| c) you make money via ads (google facebook) and ai/ml helps
| with better targeting
|
| everyone else is pissing away VC money.
| alberth wrote:
| A) so you're competing against aws, azure, etc. That sounds
| brutally tough.
|
| B) re: value adds, like what exactly?
|
| C) this seems like such core functionality that a company
| wouldn't outsource this to a 3rd party vendor. If that's the
| case, there isn't an opportunity to sell anything if you're
| that AL/ML vendor then.
| emmender1 wrote:
| A) aws/azure need nvidia/amd chips in their servers... it
| is too difficult to homegrow these chips (altho aws is
| trying) B) microsoft (github autopilot 20$ per month per
| user), document/image autogeneration from a prompt (likely
| in word doc 5$ a month per user for this) C) right yea,
| thats why fb/goog have big ai farms
| htrp wrote:
| > a) a hardware vendor nvidia whose products are needed by
| anyone in the game
|
| FTFY.... I don't think AMD will be competitive in AI until at
| least 2025, though given their broken roadmap promises, not
| sure if anyone will be willing to invest in them
| unmole wrote:
| I mean you still need CPUs to run your workloads. And AMD
| makes decent ones. I work for a company that sells data
| centre network switches. There's nothing AI specific in our
| boxes but we will sell a lot more if them if people are
| building more data centres to cater to AI driven demand.
|
| Something, something gold rush, shovels.
| htrp wrote:
| Great point! But while demand for network switches
| explodes, do you really get a competitive advantage from
| one company's switches vs another? (serious question as
| I've never had to build a DGX superpod or anything like
| it from scratch).
| unmole wrote:
| > do you really get a competitive advantage from one
| company's switches vs another?
|
| I am obviously biased but IMHO, yes. High end switches
| are not commodity gear. And a lot of the differentiating
| secret sauce is in software. So, even if two switches
| from two different vendors have the same silicon, they
| might have dramatically different characteristics. That
| is without going into other aspects like integration with
| the rest of the stack, quality of support and even lead
| times.
| biztos wrote:
| d) you give people who can't use b) a version of b) they can
| use.
| hospitalJail wrote:
| Time to find a new website to share models.
| alberth wrote:
| Confusing Pricing.
|
| https://huggingface.co/pricing
|
| I'm probably missing the obvious, but one part on the pricing
| page it says Spaces Hardware starts at $0 ... and another part
| says it starts at $0.05.
| throwaway644788 wrote:
| The whole GTM is confusing. They're experts at ML and
| community, and awful at business. I know HN looks down on sales
| persons, but HF needs some good ones, ASAP.
| ShamelessC wrote:
| > experts at ML
|
| Citation needed.
| espadrine wrote:
| They are covering a range of use-cases. I agree the naming is
| inconsistent. It goes like this:
|
| * Repository storage is free, with a paid enterprise offering,
| a la GitHub.
|
| * Serving a demo app has hourly costs ("Spaces Hardware")
|
| * Serving a production model for an app hosted elsewhere is
| also hourly ("Inference endpoints")
|
| * Training models is free for now ("AutoTrain"; honestly I
| haven't tried this one.)
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