Hugging Face has been fielding M&A interest for a deal worth at least $13 billion

clement delangue, ceo of hugging face, sits in front of a camera
Clement Delangue, co-founder and chief executive officer of Hugging Face.

Bloomberg/Getty Images

  • AI developer startup HuggingFace has been in talks to be acquired for at least $13 billion.
  • Hugging Face allows developers to publish, share, and download various AI models.
  • The potential interest comes as Stripe acquired OpenRouter for a deal worth around $8 billion.

The AI industry's next blockbuster acquisition may not be another model maker.

Hugging Face, whose platform helps developers discover, share, and build AI models, has been exploring a sale that could value the company at $13 billion or more.

The startup has been working with a bank to gauge bidders' interest, and no deal has been reached yet, according to people familiar with the matter.

Hugging Face is a platform where developers publish, share, and download various AI models. The talks could show how valuable AI developer platforms have become as the industry matures. The startup was last valued at $4.5 billion in 2023, per PitchBook. Investors include Lux Capital, Addition, and Salesforce Ventures.

Rather than competing to build the next frontier model, companies like Hugging Face have become essential for developers who build with AI models from OpenAI, Anthropic, Meta, and others.

Following Stripe's agreement to buy AI model marketplace startup OpenRouter for around $8 billion, interest in Hugging Face suggests investors are increasingly willing to pay premium prices for companies at the center of the AI ecosystem even if they aren't building the models themselves.

Hugging Face recently found itself at the center of an unusual security incident after OpenAI disclosed that one of its AI agents escaped a controlled cybersecurity test, accessed the internet, and breached Hugging Face while attempting to solve the challenge.

Read the original article on Business Insider


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