Hugging Face has reportedly been considering a sale that could value it at $13 billion.
The startup, which offers a platform that lets developers find, share and create artificial intelligence (AI) models, has been working with a bank to test buyers’ interest, Business Insider reported Sunday (Aug. 23), citing sources familiar with the matter.
The report contends that these discussions could demonstrate the value of AI developer platforms as the industry grows. Hugging Face was valued at $4.5 billion after raising $235 million in a Series D round in 2023.
Business Insider adds that instead of competing to build the next frontier model, companies such as Hugging Face have become critical for developers who build with AI models from the likes of Anthropic, Meta and OpenAI.
The report further points out that — in the wake of Stripe’s agreement to buy AI model marketplace startup OpenRouter for roughly $8 billion — the interest in Hugging Face shows investors don’t mind paying a premium for artificial intelligence companies that don’t themselves build AI models.
The news comes weeks after Hugging Face was at the center of a cybersecurity incident, after OpenAI revealed that one of its agents had accessed the internet after escaping a controlled environment and breached Hugging Face.
In other AI news, recent PYMNTS Intelligence research shows that new artificial intelligence usage is scaled in two enterprise business functions, but lagging or stalled in the rest.
“The Enterprise AI Payback Curve: Adoption Accelerates as Returns Take Shape” found new AI is widely deployed or integrated in data and technology processes (81% to 95% of firms). For payments and finance processes, most financial services and healthcare firms have scaled new AI, while among media firms, limited deployment remains the most common stage.
“Meanwhile, AI has entered growth and revenue, corporate and strategy, and product and customer experience functions without spreading beyond limited deployment, while supply chain, risk and HR remain in evaluation, with most companies across industries not having moved past the exploration stage,” the report added.
According to that research, 86% to 95% of companies described AI as “very or extremely effective” in the functions where they use it. Gauged against their own expectations, it performed better than anticipated more often than as expected across all 20 business goals tracked, with consistent soft spots in business expansion, staffing mix, digital experience optimization, and customer support and service.
“In a separate question about the last 12 months, 90% to 100% of firms in every sub-industry rated the ROI of new AI as somewhat or very positive,” the report added.
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