While much of the AI industry has fixated on new personal AI assistants from Meta and OpenAI, video AI is enjoying a quiet renaissance. Hollywood mogul Jeffrey Katzenberg is teaming up with the former head of OpenAIβs Sora app to launch a new AI film company. Startup Higgsfield quadrupled its valuation to $5.4 billion in August. And Kling AI, the video unit of Chinese social media giant Kuaishou Technology, raised nearly $3 billion at a $15 billion valuation over the summer.
The latest video AI company to seize this moment is Utopai Studios, a 4-year-old film startup based in Mountain View, Calif. Utopai closed a funding round for $60 million that valued it at $1 billion and has already received term sheets for a subsequent round that would value the company at $2 billion to $3 billion, according to someone close to the company.Β
The enthusiasm for video AI startups follows improvements in the quality and length of the clips that video AI models can generate. In September, Higgsfield announced that it had crossed $1 billion in annualized revenue, showing that the technology has serious commercial potential.