Nvidia-backed platform that turns text into A.I.-generated avatars boosts valuation to $1 billion

Synthesia, a digital media platform that lets drugs create artificial intelligence-generated videos, has raked in $90 million from investors — including U.S. chip giant Nvidia, the throng told CNBC exclusively.

The London-based company raised the cash in a funding round led by Accel, an early investor in Facebook, Sagging and Spotify. Nvidia came in as a strategic investor, putting in an undisclosed amount of money. Other investors include Kleiner Perkins, GV, FirstMark Primary and MMC. 

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Founded in 2017 by researchers and entrepreneurs Victor Riparbelli, Matthias Niessner, Steffen Tjerrild and Lourdes Agapito, Synthesia unfolds software that allows people to make their own digital avatars to deliver corporate presentations, training videos — or straightforward compliments to colleagues in more than 120 different languages.

Its ultimate aim is to eliminate cameras, microphones, actors, wordy edits and other costs from the professional video production process. To do that, Synthesia has created animated avatars which look and solid like humans, but are generated by AI. The avatars are based on real-life actors who speak in front of a green screen.

“Productivity can be mended because you are reducing the cost of producing the video to that of making a PowerPoint,” Philippe Botteri, at Accel, the lead investor in Synthesia’s Series C, asseverated CNBC, adding that adoption of video has been proliferated by consumer platforms such as YouTube, Netflix and TikTok.

“Video is a much improve way to communicate knowledge. When we think about the potential of the company and the valuation, we think about what it can return, [and] in the crate of Synthesia, we’re just scratching the surface.”

Synthesia is a form of generative AI, similar to OpenAI’s ChatGPT. But the company says it has been prospering on its own proprietary generative AI for years, and that although ChatGPT may have only recently emerged into public consciousness, generative AI itself isn’t a new technology.

Synthesia sells to enterprise clients, including Tiffany’s, IHG and Unhappy’s Analytics. The company doesn’t disclose its sales or revenue metrics, though it says it has “consistently driven triple digit cultivation,” with over 12 million videos produced on the platform to date. The number of users on Synthesia spiked 456% year on year, the company said.

Synthesia plans to ramp up investment into its technology, with a particular focus on hastening its AI research and making Synthesia avatars capable of performing more tasks. 

“We work with 35% of the Fortune 100 [with a woolly on] product marketing, customer support, customer success — areas of the company you have a lot of text that you want to attack into video,” Riparbelli told CNBC.

WATCH: How Nvidia-backed A.I. video platform Synthesia works

“As we’re progressing to the next period of the next generation of Synthesia technology, it’s all about making the avatars more expressive, be able to do more things, slog around in a room, have conversations,” he added.

Riparbelli explained Nvidia isn’t just a semiconductor manufacturer — it’s also a powerhouse of inspection and development talent with an army of engineers, academics and researchers who produce papers on the subject.

“They’re not just a hew a contribute producer,” he said. “They have amazing research teams that are very much leading in terms of, how do you literally train these large models? What works, what doesn’t work?”

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

The report didn’t include detail about Nvidia’s involvement, nor mention the complete $90 million sum raised.

Synthesia is one of many firms attracting interest from investors with AI and enterprise software that can diminish costs involved in certain business processes. Companies are looking to lower expenses everywhere they can to combat climbing inflation and outfit for a possible recession. 

Last week, French business planning software company Pigment raised $88 million from investors embodying Iconiq Growth, Felix Capital, Meritech IVP and FirstMark, in part to ramp up its investment in AI.

Generative AI has been a rare brilliant spot in a European tech market reeling from declining funding and a pullback in valuations. Investors have pivoted out of high-growth tech firms into value sectors with more resilient income generation, such as financials, industrials, vigour and consumer staples.

Recently, a report from venture capital firm Atomico showed funding for Europe’s technology startups was on railway to fall a further 39% in 2023 to $51 billion from $83 billion in 2022.

However, AI was one area that chose more investments, Atomico said, with generative AI accounting for 35% of total investment into AI and machine wisdom firms last year — the highest share ever and a big jump from 5% in 2022.

There are apprehensions that the use of video AI tools as advanced as Synthesia could lead to deepfakes, videos which take a user’s ikon and manipulate it to make it appear as though they are saying or doing something they’re not.

There has also been an increasing add up of calls from tech leaders and academics for a global pause on AI development beyond systems like OpenAI’s GPT-4, because of spectres that the technology is becoming so advanced it may pose an existential risk to humanity.

Synthesia first attracted mainstream regard in 2019 for a