Ex-Microsoft Engineer's AI Video Startup Secures $60M in Funding from Leading VCs and Jared Leto

As demand for generative AI video increases, startups in the sector are attracting significant investment from venture capital firms. Recently, Captions, an AI video startup founded by former Microsoft engineer Gaurav Misra, raised $60 million in Series C funding, enhancing its appeal in this booming market.

Founded in 2021, Captions initially launched as a camera app for recording 'talking videos' directly with the camera. Over the past year, it has pivoted to focus on AI, allowing users to create videos from scratch using custom avatars. This transformation has positioned Captions as an AI-powered creative suite for video producers.

The latest funding round, led by Index Ventures, values Captions at $500 million. It includes contributions from existing investors like Kleiner Perkins, Sequoia Capital, and Andreessen Horowitz, as well as newcomers such as Adobe Ventures, HubSpot Ventures, and actor Jared Leto.

Captions plans to use this capital to expand its machine learning team in New York and accelerate the development of innovative generative AI features, solidifying its position in the AI video landscape.

Captions’ Comprehensive AI Video Suite

Captions has evolved from traditional video creation, where users recorded and edited manually, into a comprehensive AI-powered suite. This platform offers everything necessary for brands and individuals to produce high-quality video content seamlessly.

The transition began with an expansion of the editing tools, including AI-assisted features for correcting eye contact, dubbing audio into different languages, creating authentic voiceovers, and generating short clips from longer videos. These enhancements attracted millions of users, but a significant breakthrough occurred when Captions introduced its AI Creator and AI Edit capabilities.

Captions AI Creator

The AI Creator allows users to incorporate custom 3D avatars into their videos, eliminating the need for manual presentations, while AI Edit enables effortless adjustments to content with just a single tap, including custom graphics, B-roll, transitions, and zoom effects.

According to Misra, "These innovative features have catalyzed a new era of creativity, empowering a broader range of creators who previously faced barriers in recording or editing."

Future Developments on the Horizon

Captions has gained over 10 million active users, with more than three million videos created monthly. This funding will allow the startup to expand its machine learning team and invest in research and technical infrastructure to enhance its video platform with additional AI capabilities.

Looking ahead, Misra shared plans to invest $100 million in generative video research in New York City, recognizing the city as an emerging hub for AI innovation.

While specific future features remain undisclosed, enhancing existing capabilities could position Captions as a formidable competitor against niche players like ElevenLabs and Synthesia. This strategic direction will also enhance the platform's value for businesses, particularly in social media management, advertising, content marketing, and growth marketing.

"Short-form video has become the dominant content format, and Captions is uniquely positioned to revolutionize how marketers create videos and engage customers," noted Brandon Greer, head of HubSpot Ventures. "We’re excited to support Captions in helping businesses of all sizes produce high-quality video content more efficiently."

Notable users of the Captions platform include Disney-owned ESPN, Shark Tank's Kevin O’Leary, Twitch founder Justin Kan, and influencer Unnecessary Inventions.