Freiburg AI start-up targets 4 billion valuation

200 to 300 million dollars in fresh capital planned

Just 14 months after it was founded in August 2024, Black Forest Labs is already one of the shooting stars of the European AI scene. According to the FT, the company is currently in talks with international VCs about a new round of financing. The goal: 200 to 300 million US dollars in fresh capital.

The prominent Silicon Valley investor Andreessen Horowitz (a16z) has been on board since Series A - and made Black Forest Labs a unicorn, proving alongside the Berlin startup n8n that US investors are taking the German AI scene seriously and are starting to invest in the early stages. The startup has not officially confirmed its current search for capital, but several sources, including Handelsblatt, speak of ongoing negotiations.

From the Black Forest to the top AI league

Black Forest Labs has made a name for itself internationally with its Flux models for AI image generation. The technology creates photorealistic or artistic images from text descriptions - and competes with models from OpenAI, Google and Midjourney.

According to the company, major tech players are already using the Flux models, including Adobe, Microsoft, Netflix, Samsung, Canva and Deutsche Telekom. A partnership with Meta, which is expected to generate 140 million US dollars for the start-up over two years, has caused a particular stir. An integration of the models into Elon Musk's chatbot Grok (XAI) also made international headlines, although XAI now relies on a self-developed model.

However, the partnership with the popular multi-modal AI model "Mistral" from France will continue. Meanwhile, the cooperation with Adobe is even leading to direct integration into Photoshop, the standard software for many designers and photographers - details can be found in the latest official press release from BFL.

100 million turnover in just one year

Since August 2024, Black Forest Labs has increased its annual turnover from zero to almost 100 million US dollars, according to t3n and Business Punk. With a market share of around 86% in the field of commercial image generation, the start-up is currently the undisputed market leader in this segment. The order volume is expected to amount to around 350 million US dollars.

This means that the company is on the verge of becoming the second most valuable AI start-up in Germany after the Munich-based defense AI Helsing (12 billion euro valuation).

Science meets entrepreneurship

Black Forest Labs was founded by Robin Rombach, Andreas Blattmann and Patrick Esser - three researchers who had previously worked on generative models at LMU Munich under the renowned AI professor Björn Ommer. Their work laid the foundation for the world-renowned Stable Diffusion image generator.

We are determined to create the industry standard for generative media.

The start-up relies on a hybrid model: parts of the technology are offered as open source in order to strengthen the developer community - an approach reminiscent of the French AI pioneer Mistral, with whom Black Forest Labs is now also cooperating.

Next milestone: video AI on the way

The Freiburg team is planning to launch a new AI model for video generation at the end of 2025. The product is intended to compete with OpenAI's Sora in terms of quality - and could become the next big growth driver.

Record valuation

Achieving a 4 billion valuation within just a few months would be a record in Germany. The coming weeks will show whether this will actually happen. However, Black Forest Labs is already showing that cutting-edge research and entrepreneurial courage from Germany can have international relevance. While US giants such as OpenAI and Google dominate with budgets in the billions, the Freiburg-based start-up is proving that innovation can also come from small teams. Together with Helsing and n8n, Black Forest Labs is one of the most exciting AI start-ups that Germany currently has to offer.