As part of Salesforce’s massive tech conference, Dreamforce, taking place this week in San Francisco, its VC arm, Salesforce Ventures just announced a new $500 million fund dedicated to AI companies. This is significant for several reasons. First, in June 2023, Salesforce Ventures doubled its AI fund from $250 to $500, so the additional $500 million brings the AI fund to $1 billion. This compares to $5 billion total deployed in its first 15 years, since its 2009 launch.
Salesforce Ventures is also among the forces making San Francisco such a hot spot for AI companies that startups worldwide are relocating to the city. Like many VC firms, for example, the venture arm hosts dinners for its portfolio companies and Fortune 500 executives (aka prospective customers). Not surprisingly, perhaps, its AI portfolio is already notable, including Anthropic, Hugging Face, Runway, and Together AI, among others.
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Speaking with investors this month at an Oracle financial analysts meeting, Oracle CEO Larry Ellison said that he expects AI to one day power massive law enforcement surveillance networks.
“We’re going to have supervision,” he said. “Every police officer is going to be supervised at all times, and if there’s a problem, AI will report that problem and report it to the appropriate person. Citizens will be on their best behavior because we are constantly recording and reporting everything that’s going on.”
Ellison might believe that continuous surveillance, driven by AI, could greatly reduce crime. But the evidence doesn’t necessarily support his assertion.
As a piece in The Washington Post notes, police data in the U.S. is historically biased — most datasets of criminal activity overrepresent people of color and low-income neighborhoods. Feeding that data into an AI model could lead it to suggest more criminal activity is in those areas, creating racially and socioeconomically biased feedback loops.
In 2019, the Los Angeles Police Department suspended its crime prediction program after an audit showed it resulted in subjecting Black and Latino people to more surveillance.
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11xAI, a startup that builds AI bots for process automation, aka automating end-to-end workflows, just raised a fresh $24 million Series A led by Benchmark. It also one of the growing crowd of AI startups relocating its headquarters to San Francisco, Hasan Sukkar, the company’s founder and CEO, told us. It was founded in London.
The Series A comes about a year after 11xAI raised a $2 million seed round led by Project A Ventures. Founded in 2022, the company calls its AI agents “automated digital workers” and like others in this field, its pitch is that its software can handle repetitive tasks, allowing human employees to focus on more strategic work.
The company focuses on go-to-market teams, like sales, marketing, and revenue operations. It started out with Alice, an AI sales representative, and has now launched Jordan, which serves as an AI phone representative. “He sounds like a real human. He can have conversations up to 30 minutes in real-time in a way that’s really intelligent,” Sukkar said.
He says the company is also approaching $10 million in annual recurring revenue and says it counts companies like Brex, Datastax, and Otter as customers, according to its website.
“Thinking ahead, there will be two additional digital workers that we are launching in the coming months,” Sukkar continued. “All of this is part of our plan to build a suit of deeply integrated agents” — or virtual employees, he added, that have names and faces with job categories they are trained on.
The 11xAI digital workers are currently trained on 25 languages, including Swedish, Italian, German, and Hebrew. Sukkar previously told TechCrunch that he was working on a bot named James and one named Bob trained to do talent acquisition and human resources tasks, but Sukkar said the company decided to release Jordan, the phone representative, first.
While Sukkar obviously believes that autonomous agents are the future of the workforce, he also says that such agents are in the very early days of innovation.
“Instead of traditional software, which is tools and workflows that make people slightly more productive or efficient, agents enable us to automate activities in a way that operates on autopilot, in a way that requires no humanity, in a way that is extremely high skill,” he says of his vision of a highly proficient, no-human-required workforce.
When AI agents can reliably replace humans in manual processes, “it would be a shift almost as big as the internet or the cloud,” he said. But 11xAI is not without competition in this area. Large established competitors include companies like UiPath, ServiceNow, and even Salesforce. Plus, as we previously reported, AI sales bots are such a fast-growing AI market that there are a good dozen of them beyond 11xAI that are growing quickly, VCs have told TechCrunch. Some of the others include Docket, Regie.ai, AiSDR, and Artisan.
Investors, like Sarah Tavel, a general partner at Benchmark, who led the $24 million Series A, is quite bullish on 11xAI, though. Tavel, who also wrote a thesis on the importance of AI in work software, now joins the board at 11xAI.
Sukkar said that the company received about eight investment offers within ten days. “It was a really fast process,” he said. “We leaned into partnering with the team at Benchmark because of the alignment on the thesis and their track record as one of the most successful investors in the world.” Other investors in the round included 20VC, Project A, Lux Capital, and SV Angel.
The company will use the money to further product development and expand its team, which currently has a headcount of 27. The company will retain an office in London, though most key staff will be relocated to SF.
“I started 11x out of an experience where, in one of my first-ever jobs I did back when I was a student, a lot of work that was monotonous and repetitive,” he said, adding that he recalls wishing there was a computer that would do it for him and how much human potential is wasted every day doing such laborious tasks. “Agents enable us to automate in a way that redefines what’s possible.”
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Typeface, a generative AI startup focused on enterprise use cases, has acquired a pair of companies just over a year after raising $100 million at a $1 billion valuation.
Typeface revealed on Monday that it’s purchased Treat, a company using AI to create personalized photo products, and Narrato, an AI-powered content creation and management platform.
Treat and Narrato will “enrich [Typeface’s] multimodal capabilities,” the company said in a press release, while “propelling [its] vision of end-to-end content lifecycle transformation.”
“Building on our foundation of multimodal AI workflows, these acquisitions’ top-tier AI technology and talent further enrich our visual and textual capabilities,” Typeface wrote in the release. “By integrating these technologies, we’re supercharging the entire Typeface portfolio.”
Typeface, founded in 2022 by former Adobe CTO Abhay Parasnis, offers tools for text and image generation, a fine-tuning engine to personalize AI to a brand’s style and integrations with third-party apps, software and services. Typeface claims to place a greater emphasis on brand governance and privacy than its generative AI rivals; for example, Typeface trains dedicated AI models for each customer to ensure their assets and activity remain private.
So how do Treat and Narrato fit into this vision? Well, both were started by founders well-acquainted with the enterprise landscape. And — not for nothing — the startups offer products appealing the sorts of corporate clients with whom Typeface does business.
NYC-based Treat, the brainchild of Matt Osman and ex-Drizly CTO Hugh Hunter, uses a company’s data on customers to generate product images that incorporate elements known to perform well with certain target demographics. For example, if a fruit vendor’s data suggested that younger men prefer seeing food ads that show a person eating the product, Treat may create an ad that depicts someone biting into fruit.
An Australian venture, Narrato — which coincidentally also launched in 2022 — sells access to an “AI content assistant” designed to help orgs achieve their internal content creation and planning goals. As founder Sophia Solanki explained to TechCrunch in an interview last March, Narrato customers also get collaboration and workflow tools including templates for articles, video scripts, blogs, emails, social media content, art and more.
Treat raised at least $8.5 million from investors including Greylock prior to the acquisition, while Narrato manage to raise more than $1 million from AirTree Ventures, OfBusiness and serial entrepreneur Shreesha Ramdas.
Typeface wouldn’t disclose the terms of either acquisition.
Treat and Narrato mark the third and fourth acquisitions for Typeface, which purchased AI photo and video editing suite TensorTour in January and chatbot app Cypher in May. It’s unclear how much of a dent those deals have made in Typeface’s $165 million warchest.
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Earlier this year, former NFL quarterback and civil rights activist Colin Kaepernick launched his AI startup, Lumi. Kaepernick has had thousands of stories written about him, and he knows a thing or two about losing control of his narrative. Now with Lumi, he’s trying to help creators take control of their own narratives, offering AI tools to write and take ownership of their stories.
We’re thrilled to welcome Kaepernick to the main stage at TechCrunch Disrupt 2024 in San Francisco, where we’ll discuss his run-ins with the media industry, the problems creators face today, and how Lumi is trying to empower its storytellers. We’ll also discuss how Kaepernick’s company is addressing the biases that plague AI models throughout the tech industry.
While many of us know Kaepernick for his Super Bowl XLVII performance or his kneel to protest racial injustice, you may be surprised to know that he’s been quietly angel investing in Silicon Valley startups since 2017. He previously told TechCrunch he has more than 50 investments to date.
He’s also become a well-rounded media executive over the last decade. The former NFL quarterback founded and runs Kaepernick Media and Kaepernick Publishing, where he sees the media industry’s deeply entrenched problems firsthand. He also sits on the board of Medium alongside a16z co-founder Ben Horowitz, who Kaepernick calls a mentor in navigating Silicon Valley.
Lumi tries to give creators more tools that were previously only available through big media companies. The startup is starting by focusing on the world of Japanese comic books, also known as manga. Some of Lumi’s tools use AI, helping storytellers with the ideation process, writing, and generating images of characters. Other tools don’t involve AI, such as publishing resources and merchandising assistance. Kaepernick also describes Lumi’s platform as a destination, where viewers can come to browse through content from a diverse group of creators.
It’s a broad and ambitious idea from someone with experience inside and outside the media industry. We’ll ask him all about how these plans are going.
You definitely won’t want to miss it. Join over 10,000 startup, tech, and VC leaders at Disrupt 2024, where you’ll engage in inspiring conversations with industry giants like Kaepernick. Secure your tickets now before prices increase at the door.
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Runway, one of several AI startups developing video-generating tech, today announced an API to allow devs and organizations to build the company’s generative AI models into third-party platforms, apps and services.
Currently in limited access (there’s a waitlist), the Runway API only offers a single model to choose from — Gen-3 Alpha Turbo, a faster but less capable version of Runway’s flagship, Gen-3 Alpha — and two plans, Build (which is aimed at individuals and teams) and Enterprise. Base pricing is one cent per credit (1 second of video costs 5 credits), and Runway says that “trusted strategic partners” including marketing group Omnicom are already using the API.
The Runway API also comes with unusual disclosure requirements. Any interfaces using the API must “prominently display” a “Powered by Runway” banner linking to Runway’s website, the company writes in a blog post. “This helps users understand the technology behind your application while adhering to our usage terms,” the post continues.
Runway, which is backed by investors including Salesforce, Google and Nvidia and was last valued at $1.5 billion, faces stiff competition in the video generation space, including from OpenAI, Google and Adobe. OpenAI is expected to release its video generation model, Sora, in some form early this fall, while startups like Luma Labs continue to refine their technologies.
With the preliminary launch of the Runway API, Runway becomes one of the first AI vendors to offer a video generation model through an API. But while the API might help the company along the road to profitability (or at least recouping the high costs of training and running models), it won’t resolve the lingering legal questions around those models and generative AI technology more broadly.
Runway’s video-generating models, like all video-generating models, were trained on a vast number of examples of videos to “learn” the patterns in these videos to generate new footage. Where did the training data come from? Runway refuses to say, like many vendors these days — partly out of fear of losing competitive advantage.
But training details are also a potential source of IP-related lawsuits if Runway trained on copyrighted data without permission. There’s evidence that it did, in fact — a report from 404 Media in July exposed an internal spreadsheet of training data that included links to YouTube channels belonging to Netflix, Rockstar Games, Disney and creators like Linus Tech Tips and MKBHD.
It’s unclear whether Runway ended up sourcing any of the videos in the spreadsheet to train its models. In an interview with TechCrunch in June, Runway co-founder Anastasis Germanidis would only say the company uses “curated, internal datasets” for model training. But if it did, it wouldn’t be the only AI vendor playing fast and loose with copyright rules.
Earlier this year, OpenAI CTO Mira Murati didn’t outright deny that Sora was trained on YouTube content. And Nvidia reportedly used YouTube videos to train an internal video-generating model called Cosmos.
Generative AI vendors believe that the doctrine known as fair use provides them a legal shield. Others aren’t taking chances; to train its video-generating models, Adobe is said to be offering artists payments in exchange for clips. If we’re lucky, cases making their way through the courts will bring clarity soon enough.
However it shakes out, one thing’s becoming clear: Generative AI video tools threaten to upend the film and TV industry as we know it. A 2024 study commissioned by the Animation Guild, a union representing Hollywood animators and cartoonists, found that 75% of film production companies that have adopted AI have reduced, consolidated or eliminated jobs after incorporating the tech. The study also estimates that by 2026, more than 100,000 of U.S. entertainment jobs will be disrupted by generative AI.
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