What would you dream of building as an entrepreneur if you had unlimited time and money?
For two India Institute of Technology graduates, Ashray Malhotra and Nisheeth Lahoti, who had experienced the pain of shutting down their first startup, their answer was simple, yet bold: build a magic box, a magic AI system, that would take any piece of input text and one day create a Hollywood-level movie.
“Imagine you only have one computer and you don’t have to go out and film anything. AI can do everything on your behalf. I really liked the idea. Because when I was in college, I was making short films. And as with anyone who has made professional quality videos, you realize the problems associated with this process: anything can go wrong. And very often in our professional-quality video that we were shooting, Murphy’s Law still applies, so that’s when we started working on this concept of building this end-to-end text engine,” says Ashray Malhotra.
Malhotra is the co-founder and CEO of Rephrase.AI, who along with co-founders Nisheeth Lahoti and Shivam Mangla founded the company in Bangalore, India in 2019. All three co-founders were named to Forbes Asia 30 under 30 2021. list. Rephrase.ai aims to democratize video, making high-quality video creation capabilities available to businesses of all sizes in all industries by providing generative and high-tech AI tools to create professional videos with the ease of writing text.
As they embarked on what they thought would be a long journey to build their dream AI engine, they knew they would need short term monetizable products. “That’s when we started working on building techniques and technology that could create a digital avatar of a person, which means a digital copy of a face, a digital copy of your voice, and create videos of people looking at the camera and we perfected this technology early last year,” says Malhotra.
It took a few years to perfect the technology, but the company has now worked with over 50 major companies, including blue-chip names like Amazon, Microsoft, Mondelez, Johnson & Johnson and Franklin Templeton with cases of B2C and B2B use. “We have created over 50 digital clones of CXO and some of the biggest celebrities in India and the United States. We recently worked with a pharmaceutical company where we created VP of Sales avatars to help her to communicate personally with each sales representative, to help her build one-on-one relationships with people she would have liked to establish in person, but couldn’t because she was part of a workforce ‘remotely distributed work’, Malhotra.
Rephrase.ai uses a consumption-based SaaS business model. There are one-time fees to create and configure the platform. Then there is a recurring element allowing customers to buy credits to create more videos themselves.
In the beginning, the founders were lucky to have early angel investments and support from Techstars India while they were just developing the technology when few people had heard of generative AI. But the magic of their demos and ever-growing client list has helped the company attract $12.2 million in funding to date. Its last Series A funding round of $10.6 million in September 2022 was led by Red Ventures. Other investors in this round include Silver Lake, 8VC and others. A first seed round of $1.5 million was raised by Lightspeed and AV8 Ventures.
Malhotra grew up in a small town in India and, like his co-founders, graduated from the Indian Institute of Technology in Mumbai. But he never planned to be an entrepreneur. “When I was in college, I believed, I said like most college kids believe that to create truly amazing products, it takes thousands of people and millions of dollars. But at the MIT Media Labs ReDx camp, I was part of a cross-functional team, including data scientists, software, engineers, dentists, and business people who, within a week, built a proof of concept for a toothbrush where you could put a camera inside that would detect a cavity before it actually became a cavity,” says Malhotra. The experience made him believe that a small group of smart, dedicated people could do amazing things. in no time. Why not him?
While working on his Masters in Engineering, he and Lahoti founded SoundRex in 2016. The company enables the wireless transmission of high-fidelity audio at very low latencies through the use of learning-based algorithms automatic and human auditory models. The venture would fail after two years, but this failure led to the development of Rephase.ai in 2019
As for the future? After focusing on expanding the platform’s enterprise communications capabilities beyond the enterprise to businesses of all sizes over the next five years, beyond that, “you want to be able to build this engine where I see every person on the internet having a digital clone and being able to create professional quality video of a level that they don’t have access to today,” concludes Malhotra.
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