Another microdrama app has raised a significant amount of funding. This shows that investors remain focused on this category, especially as companies adopt AI.
Israel-based micro-drama app Shortical has raised $100 million in funding from financial services firm PvX Partners, the companies shared exclusively with Business Insider.
Shortical is part of the trending microdrama market. These companies produce short series intended for viewing on mobile phones, with titles such as “The Foul with My Brother’s Best Friend” and “The Beach Volleyball Virgin.”
Deloitte predicted that revenue from microdrama apps will more than double to $7.8 billion this year, with the US accounting for about 40% of that. Hollywood has also taken notice, with players from Disney to Fox Entertainment investing in their own vertical series in a variety of ways.
Shortical isn’t the biggest player in the space, but it has grown in recent months in the U.S., ranking 24th among microdrama apps by downloads in the first half of 2026, according to analytics firm Sensor Tower, up from 39th in the second half of last year.
Shortical CEO and co-founder Guy Simoni touted the app’s focus on talent and AI tools that support screenwriters, rather than replacing them. The company employs 15 full-time screenwriters and has worked with talents like Ofir Lobel, who directed Netflix series such as “Black Space.”
But when it comes to on-screen talent, Shortical believes AI-generated series will be a big part of the future. So far, the company has released “Bound by Fire,” an epic fantasy starring AI actors, and said it has another in the works. Shimoni said the audience response to “Bound” was on par with the live-action series. The company said it plans to produce 20 hours a month of AI programming and five hours of live-action programming performed by humans over the next few months.
“We believe AI has the potential to be 10 times more effective than live production for the same or lower budget,” Simoni said. “Over the long term, it’s going to be 10 times, if not 100 times.”
Other microdrama companies are also rapidly moving toward AI-driven series, which can be produced for a fraction of the $100,000 to $300,000 cost of a typical one-hour series.
The company said that Shortical’s move to AI, along with the quality of Shortical’s team and return on ad spend, was taken into account when PvX made its investment.
“My personal opinion is that without AI, this space wouldn’t exist,” said Joe Wadakethalakal, CEO of PvX Partners. “This is driven by significantly lower production costs to create this content.”
Shortical is producing more AI-generated series like its debut “Bound by Fire.” short story
Microdramas are attracting new types of funding
PvX investments are notable for their size and variety. Previous funding by prominent microdrama companies includes Holywater, which raised $22 million, and GammaTime, which received $14 million. Some investors have expressed skepticism about the durability of the category due to high customer acquisition costs.
The funds raised by Shortical are user acquisition loans, a type of debt commonly used by mobile gaming apps. This is PvX’s third investment in the Microdrama app, following StoReel and Luni.
Wadakethalakal said user acquisition funding makes sense given Shortical’s stage of growth. Under the deal, PvX does not receive equity in the company, but rather takes back a portion of the revenue Shortical earns from new users. This allows the founders to retain more ownership. (Shortical also raised VC funding from Net Capital Ventures and Sticker Ventures earlier this year, for an undisclosed amount of $15 million, Shimoni said.)
Hernan López, founder of streaming research firm Oulu & Company, said the use of user acquisition funds is a sign of credibility in the microdrama industry.
“We need to prove that unit economics exists,” he says.
Most micro-drama apps are subscription-driven and rely heavily on paid marketing to get users to download the app. Shortical lets viewers get a few free episodes and then sell coins to unlock episodes, offering unlimited viewing plans for $7.99 per month and $124.99 per year.
Some industry insiders predict that as people experience subscription fatigue, this model could shift toward advertising and viewing to apps like TikTok that already have a built-in user base.