Artificial intelligence from the Black Forest beats OpenAI

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A small company from Freiburg is currently causing a stir in the international AI world. Its name: Black Forest Labs. The start-up released its new image generator FLUX.1 on August 1st, which, according to research by Capital, was used several million times in the first week.

FLUX.1 creates a suitable image from a text description at the click of a mouse – similar to a professional graphic designer. In the fastest version, the artificial intelligence needs less than ten seconds to do this. Industry experts consider the AI ​​from the Black Forest to be quite competitive with US giants such as OpenAI and Midjourney. And this despite the fact that the company behind it is only two months old and reportedly only employs 14 people.

“The litmus test for image generators is how well they can represent hands, text and complex scenes,” says Tristan Post, who teaches AI and entrepreneurship at the Technical University of Munich. In all of these disciplines, the model has so far been convincing in sample tests. “This is state of the art,” says Post.

Better than industry leaders

According to Black Forest Labs, FLUX.1 even outperforms the leading image generators Midjourney V6 and DALL-E 3 from OpenAI in the so-called ELO score, a common performance test for artificial intelligence. The newcomer is therefore making big waves in the scene: In the trend charts of the open source platform Hugging Face, FLUX.1 in various versions currently ranks first and second and has been downloaded more than 500,000 times.

The makers behind the surprise hit prefer to let the technology speak for itself. Apart from the announcement about their image generator, they have barely revealed anything about themselves. “We are determined to create the industry standard for generative media,” they say. A video generator will follow soon.

However, the founders Robin Rombach, Andreas Blattmann and Patrick Esser have already made a name for themselves in industry circles. All three previously researched the fundamentals of artificial image generation at the Ludwig Maximilian University of Munich under the renowned AI professor Björn Ommer.

Partnership with X

Their work resulted in, among other things, the code for the image generator Stable Diffusion, which was incorporated into the British start-up Stability AI in 2022. Rombach and Blattmann were employed there as scientists until March 2024. At the beginning of the year, however, the company almost imploded after it ran into financial difficulties, Getty Images sued them for alleged copyright infringement and numerous key employees were fired.

With Black Forest Labs, the top researchers now have to show that they can do it better than Stability AI – and build a viable business model. The company has entered into an initial partnership with Elon Musk’s Twitter successor X, which has been offering the image generator to its premium customers since mid-August. It will be interesting to see how Black Forest Labs deals with ethical questions surrounding the creation of potentially misleading content.

The start-up could face uncomfortable legal questions in this context. “You can see a clear improvement compared to other models, but obviously some guard rails have been left out, for example in the use of trademark rights,” says AI professor Björn Ommer, the founders’ former doctoral supervisor. AI-generated images from FLUX.1 that users posted on the Internet included the logos of Nike and Coca-Cola. It is also possible to portray politicians in an unfavorable context.

Hope for the location?

To ensure further growth, the start-up recently completed its first round of financing of 31 million US dollars. The money comes from, among others, the US investment firms Andreessen Horowitz and General Catalyst, the Swabian investor Mätch VC and prominent figures from Silicon Valley, including Y-Combinator boss Gary Tan.

However, the exact ownership structure of Black Forest Labs cannot be viewed because the company is registered in the US state of Delaware – a fairly common constellation in international financing rounds.

The successful launch of the new image generator and the well-known investors should also raise new hopes for the German AI location, which notoriously suffers from brain drain. “Black Forest Labs shows that we in Germany are apparently still able to keep up internationally with AI developments,” says AI expert Tristan Post. At the same time, the surprise hit from Freiburg also makes it clear that the race for market leadership is still completely open.