AI Firm Synthesia Reaches $1 Billion Valuation in Nvidia-Backed Series C

Synthesia, a digital media platform that lets users create videos generated by artificial intelligence, has raised $90 million from investors including US semiconductor giant Nvidia, the company told CNBC exclusively.

The London-based company has raised cash in a funding round led by Accel, an early investor in Facebook, Slack and Spotify. Nvidia participated as a strategic investor, contributing an undisclosed amount. Other investors include Kleiner Perkins, GV, FirstMark Capital and MMC.

Founded in 2017 by researchers and entrepreneurs Victor Riparbelli, Matthias Niessner, Steffen Tjerrild, and Lourdes Agapito, Synthesia allows people to create their own digital avatars to share company presentations, training videos, and even video content in over 120 languages. I develop software that allows me to offer compliments to my colleagues.

Its ultimate goal is to eliminate cameras, microphones, actors, lengthy editing and other costs from the professional video production process. To that end, Synthesia has created animated avatars that look and sound like humans, but are generated by AI. Avatars are based on real-life actors speaking in front of a green screen.

Philippe Botteri of Accel, lead investor in Synthesia’s Series C, told CNBC, “There is potential for increased productivity because the cost of producing a video can be as low as the cost of creating a PowerPoint.” It added that consumer adoption of video is booming. Platforms like YouTube, Netflix, TikTok.

“Video is a much better way to convey knowledge. When we think about the potential and valuation of a company, we think about what it can bring. [and] For Synthesia, we’ve only scratched the surface. “

Synthesia is a form of generative AI similar to OpenAI’s ChatGPT. But the company says it has been working on its own generative AI for years, and while ChatGPT may have only recently entered the public consciousness, generative AI itself is not a new technology.

Synthesia sells to enterprise customers such as Tiffany, IHG and Moody’s Analytics. The company didn’t disclose sales or revenue metrics, but said the platform has produced more than 12 million videos to date and is “consistently driving triple-digit growth.” The company said Synthesia’s user numbers surged 456% year-over-year.

Synthesia plans to increase its investment in technology, with a particular focus on advancing AI research and enabling Synthesia avatars to perform more tasks.

“We work with 35% of the Fortune 100 companies [with a focus on] Product marketing, customer support, customer success are areas where companies have a lot of text they want to convert to video,” Riparveri told CNBC.

“As we move into the next phase of our next-generation Synthesia technology, it is important to make our avatars more expressive, capable of doing more, walking around rooms, and having conversations. to do it,” he added.

Riparbelli explained that NVIDIA is more than just a semiconductor manufacturer, it is also a powerhouse of R&D talent with an army of engineers, academics and researchers writing papers on the subject.

“They are more than just chip makers,” he says. “They have a great research team who are really good at how they actually train these large models, what works and what doesn’t.”

Business Insider previously reported that Synthesia was in talks with investors to raise between $50 million and $75 million in new funding at a valuation of around $1 billion.

The report doesn’t contain any details about NVIDIA’s involvement, nor does it mention a total funding of $90 million.

Synthesia is one of many companies garnering investor interest for AI and enterprise software that can reduce the cost of certain business processes. Businesses are trying to cut costs wherever possible to combat rising inflation and prepare for a possible recession.

Last week, French business planning software company Pigment raised $88 million from investors including Iconiq Growth, Felix Capital, Meritech IVP and FirstMark, as part of a ramp-up of investments in AI.

Generative AI is a rare bright spot in Europe’s tech markets, which are reeling from declining funding and falling valuations. Investors are shifting from high-growth technology companies to value sectors with more resilient income generation, such as financials, industrials, energy and consumer staples.

A recent report by venture capital firm Atomico said funding for European tech start-ups will drop another 39% to $51 billion in 2023, down from $83 billion in 2022.

But AI is one of the areas that attracted more investment, Atomico said, with generative AI accounting for 35% of total investment in AI and machine learning companies last year, the highest share ever, and by 2022. It is said that it increased significantly from 5% of

Concerns that the use of advanced video AI tools like Synthesia could lead to deepfakes, videos that take a likeness of a user and manipulate it to make the user say or do things that aren’t really there there is.

In addition, technology leaders and academics are concerned that technology may become too advanced and pose a risk to human survival, so AI development beyond systems such as OpenAI’s GPT-4 is recommended. There are growing calls for a global pause.

Synthesia first gained mainstream attention in 2019 with a deepfake video featuring a digitally animated version of football star David Beckham speaking in nine languages ​​about his campaign against malaria.

This was done with Beckham’s consent and for good reason, but the more widespread use of deepfake technology has raised concerns about possible misinformation.

To address this, Synthesia says it keeps ethics in mind when developing its software. The company requires the consent of people who appear as avatars in its software, and uses a combination of human and machine learning to target content such as profanity and hate speech.

We are also signatories to the Responsible Practices in Synthetic Media, an industry-wide voluntary framework for the ethical and responsible development, creation and sharing of synthetic media.

“There are a lot of discussions going on right now. There are discussions about very long-term existential risk scenarios. I think it’s important to talk about those as well. I want more focus on ‘Today? ” Riparbelli said in an interview with CNBC.

“These technologies are already powerful. How do we deal with hallucinations? How do we deal with all the problems that arise?” he added. “There are certainly pitfalls. But I also think there are so many opportunities to level the playing field and enable people to do more with less.”