Raghavan RS, the Co-Founder of the start-up Animaker which launched an AI-patented software that could put together a complete video by merely feeding text, suddenly noticed a lot more emails in his inbox after its launch last year. Big players and top VCs were sending him a stream of messages vying for this coveted application called Steve.AI. “Almost every week I am getting acquisition offers. Every VC out there wants to fund Steve.AI for sure,” he says.
Raghavan’s start-up is riding the new wave of interest from investors in AI-related software after Chat GPT’s massive success. Although conceived and launched way before ChatGPT, it has certainly given it increased momentum. The boom in the creator economy that is drawing in thousands of people to become digital influencers has also favoured start-ups like Animaker that provide digital tools to non-pro users to make videos without much hassle.
“People have started spending on tools. Earlier, say 3-4 years back, they were looking for free tools. Once they started making money through monetisation of their content, they want to invest in tools, invest in equipment, and so on. That has fuelled our growth,” says Raghavan.
Adding colour to content
The creative SaaS start-up fills a white space in the market as it targets anyone toggling between a professional Adobe Creative Suite and entry-level apps that are limited in extent of what they can do. “Adobe is complex, professionals-only software. Canva is beginner-friendly. But there’s a huge gap between these two. Just because you are well-versed in Canva does not mean you can jump to Adobe Photoshop now. There’s a market in between. That’s what we are targeting,” he explains. The inspiration and idea are to give a PowerPoint-like experience for video creation and animation for the end user.
For Martin Broadhurst, Managing Director of Broadhurst Digital Ltd, a sales and marketing consultancy company based in the UK, Steve.AI has been easy to adopt. “Steve.AI is a fine option for anyone wanting to create simple videos using AI. It’s comparable to tools such as Wave.video and I found it easier to use, with better results than Pictory,” he says.
Animaker is hoping to reach $30 million in revenue this year with 20 million end users, but Raghavan says, it has only scratched the surface of this large, unexplored market. Besides content creators, the start-up serves social media marketers, large corporates like GSK and Unilever (predominantly for L&D purposes), and e-commerce companies that depend on simple content-creating tools.
Take the case of Hermes, a New Zealand-based digital marketer, who noticed 2x growth in engagement after using Steve.AI. “Honestly, people are tired of stock footage, so the conversion rate is getting lower and lower. Then Steve.AI came at a good time. Animation videos are more attractive and joyful to watch. My clients love this type of video a lot and the feedback from the ad campaigns also tells us that the audience loves it too,” he says.
Crafting a future
While it launched in 2015 with its flagship tool Animaker which helps you create studio-quality animation, the start-up has gradually expanded into graphics and videos after Animaker became a runaway hit. The umbrella product has eight separate web applications now to solve for different problems in do-it-yourself (DIY) video creation. For instance, Animaker Voice can convert any text into ultra-realistic voiceovers that you can lay on top of your videos. Picmaker is a graphic design software that lets you create unique designs in minutes. Then there is a subtitle generator and avatar creator for your presentations, and so on.
It doesn’t stop there. Raghavan, along with his Co-Founder Loganathan, wanted to further lower the cost and access barriers to content creation. Hence, the ambitious project of converting text to video using AI was born—Steve.AI. The only thing needed to create a video in this web application is a script, everything else is taken care of.
To be successful in any AI-based project, you need extraordinary research and datasets to train your model, and no prices for guessing, Animaker had both. A research team in Bangalore, headed by Prof Vineet Gandhi of International Institute of Information Technology, Hyderbad, began work on this project in 2018-19. After the technology started taking shape, Animaker had large tomes of videos and animations that users created that were used by Steve.AI for testing purposes.
Ask Srinivas how to identify gaps, he says, “We work backwards. Our team of designers and artists discuss with the market research team about interesting problems to solve. Then, the tech team works on making it happen. It’s never the other way around where we have interesting tech and we can package it and sell.”
The 210-strong start-up headquartered in Tidel Park, Chennai, one of the city’s first software parks, with a sales and marketing office in the US, is profitable and completely bootstrapped. Despite being bombarded with VC offers, Srinivas, who spends most of his time in San Francisco, is not ready to raise funding yet. “We are not against the idea of VC funding, but we want to raise money at the right time. Our business is not as capital-intensive or sales-driven. We are comfortably not funded. It is more about execution challenges, so we never had any big financial necessity,” he says.