Meta Platforms Inc. has entered into a multi-year agreement worth over $100 million with German AI startup Black Forest Labs, marking another major step in its push to strengthen artificial intelligence capabilities.
As part of the contract, Meta is expected to invest $35 million in the first year and $105 million in the second year, according to a source familiar with the matter who requested anonymity as details have not been made public. Both Meta and Black Forest Labs declined to comment, with the latter stating it does not discuss “current or potential partnerships.”
Meta has been moving assertively to boost its AI portfolio by hiring leading talent from rival firms and forging partnerships with AI developers. In August, Meta partnered with Midjourney to access its “aesthetic technology,” though financial terms of that collaboration were not revealed.
Founded just a year ago by computer scientists who previously contributed to Stable Diffusion, Black Forest Labs has quickly established itself as a notable player in the AI image and video generation space. The startup gained attention for its work with Elon Musk’s xAI chatbot Grok, which introduced an image generation feature last year.
The tool created both viral and controversial outputs, including characters such as Elmo and Mickey Mouse depicted with weapons. Addressing its mission, a spokesperson for Black Forest Labs said the company “is committed to developing state-of-the-art technology responsibly.”
According to a source, Black Forest Labs has already secured $96.3 million in annual recurring revenue as of August and has entered into partnerships with major companies such as Adobe Inc., Canva Inc. and Snap Inc., representing about $300 million in total contract value, including the Meta deal. The startup expects its annual recurring revenue to grow to $300 million by fiscal 2026. In May, it launched Flux Kontext, an image editing model.
To date, Black Forest Labs has raised more than $100 million in venture funding, including a round led by Andreessen Horowitz that valued the company at around $1 billion.
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