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London-based AI start-up Synthesia has raised funding at a valuation of $4bn, as it seeks to challenge global rivals building interactive, realistic digital avatars of people.
The company said on Monday it had closed a new $200mn funding round led by existing investor Google Ventures. This nearly doubles the UK group’s valuation from a year ago, when it was valued at $2.1bn.
New investors include venture funds Evantic Capital, founded by former Sequoia investor Matt Miller, and Hedosophia. Existing investors such as Nvidia’s venture arm NVentures, Accel and Air Street Capital also participated in the round.
Synthesia co-founder and chief operating officer Steffen Tjerrild told the FT the money would be used to develop its conversational AI avatars, which allow users to ask questions, role-play and receive more tailored answers. The company plans to roll out the features this summer.
The fundraising comes as AI start-ups have continued to attract investor interest globally. While the US and China have led the race to develop generative AI models, Europe’s start-ups have found traction by focusing on AI applications and services aimed at businesses.
“Trying to win this global race, as a European company, we want to be well capitalised to take that opportunity to invest globally and set up commercial footprints around the globe,” said Tjerrild.
Rivals including UK-founded voice AI start-up ElevenLabs are also raising new money. The FT reported this month that the start-up is in talks to raise hundreds of millions of dollars at an $11bn valuation, which would almost double its value in a matter of months.
Synthesia uses generative AI models to create realistic avatars, which can be prompted to read out text in a lifelike way in several different languages. It has focused on selling its services to enterprises for corporate training materials.
Tjerrild added that changing videos from a one-way viewing experience will allow companies to “upskill, assess and drive meaningful performance and productivity”.
Synthesia said early feedback of its interactive avatars from customers, which include over 90 per cent of Fortune 100 companies such as Zoom and Heineken, was positive, with customers reporting higher engagement with content.
The company was founded in 2017 and has grown its headcount by 40 per cent in the past year to about 600 employees, with offices in London, New York and across Europe.
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