# Below the Noise Floor: Bimodal Seed Collapse and Distinct Failure Modes in Small-Model Knowledge Distillation

arXiv: https://arxiv.org/abs/2608.27729 · HTML: https://mlsanity.com/paper/2608.27729/

## Key facts

- No citing papers in the map yet (data through 14 Oct 2026).
- Placed in Knowledge distillation for LLMs, one of 12 directions in Knowledge distillation.
- Builds on 16 of its 20 references that are in the map.
- First posted on arXiv 27 Aug 2026.

## Placed in

- Knowledge distillation / [Knowledge distillation for LLMs](https://mlsanity.com/distill/knowledge-distillation-for-llms/)

## Builds on (most cited first, 16 of 16)

- [Distilling the Knowledge in a Neural Network](https://mlsanity.com/paper/1503.02531/) (2015)
- [Representation Learning with Contrastive Predictive Coding](https://mlsanity.com/paper/1807.03748/) (2018)
- [DistilBERT, a distilled version of BERT: smaller, faster, cheaper and lighter](https://mlsanity.com/paper/1910.01108/) (2019)
- [ToolLLM: Facilitating Large Language Models to Master 16000+ Real-world APIs](https://mlsanity.com/paper/2307.16789/) (2023)
- [Gorilla: Large Language Model Connected with Massive APIs](https://mlsanity.com/paper/2305.15334/) (2023)
- [Sequence-Level Knowledge Distillation](https://mlsanity.com/paper/1606.07947/) (2016)
- [Distilling Step-by-Step! Outperforming Larger Language Models with Less Training Data and Smaller Model Sizes](https://mlsanity.com/paper/2305.02301/) (2023)
- [Fine-Tuning Pretrained Language Models: Weight Initializations, Data Orders, and Early Stopping](https://mlsanity.com/paper/2002.06305/) (2020)
- [Teaching Small Language Models to Reason](https://mlsanity.com/paper/2212.08410/) (2022)
- [On the Stability of Fine-tuning BERT: Misconceptions, Explanations, and Strong Baselines](https://mlsanity.com/paper/2006.04884/) (2020)
- [Does Knowledge Distillation Really Work?](https://mlsanity.com/paper/2106.05945/) (2021)
- [Reporting Score Distributions Makes a Difference: Performance Study of LSTM-networks for Sequence Tagging](https://mlsanity.com/paper/1707.09861/) (2017)
- [Annealing Knowledge Distillation](https://mlsanity.com/paper/2104.07163/) (2021)
- [TinyAgent: Function Calling at the Edge](https://mlsanity.com/paper/2409.00608/) (2024)
- [Octopus v2: On-device language model for super agent](https://mlsanity.com/paper/2404.01744/) (2024)
- [Selective Knowledge Distillation for Neural Machine Translation](https://mlsanity.com/paper/2105.12967/) (2021)

## Abstract (arXiv)

Function routing -- selecting the correct API call from a fixed catalog given a natural-language request -- is a deployment problem where small students are attractive but knowledge distillation gains are typically reported single-seed, at scales where seed variance is unknown. On a 740-instance healthcare API routing task with a 1.5B Qwen student and a 20B teacher, we compare eight KD variants against supervised cross-entropy, using three to six seeds for key configurations. We find: (i) per-seed standard deviation ranges from 2.8 to 48.7 percentage points, swallowing every claimed KD gain below five points; (ii) three of seven KD variants exhibit bimodal collapse, with at least one in three to five seeds falling below 55% accuracy while the others train normally, and a fourth showing elevated variance; (iii) collapse has distinct modes -- wrong-function selection for ce_kd and ce_paraphrase, and a previously undocumented output-truncation mode for reasoning_kd, where the model emits reasoning but terminates before producing a function name (0.9% accuracy); (iv) only progressive_kd and rank_kd avoid collapse across observed seeds, with sigma <= 3.9 pp; (v) a naive cross-split +3.78 pp gain from input enrichment reverses to -2.70 pp under controlled within-split multi-seed re-testing. Single-seed evaluation is therefore unable to detect central failure modes in small-model KD.