US-based tech giant Adobe has reportedly acquired Bengaluru-based AI-powered video creation platform Rephrase.ai.
This is Adobe’s first acquisition in the Indian startup ecosystem and also its first acquisition of a generative AI startup.
Citing an internal memo circulated by Adobe, ET reported that the transaction would help the tech giant accelerate its ability to provide AI-powered video content tools to its customers.
Following the acquisition, a majority of Rephrase.ai’s team members will join Adobe, the report said.
“The Rephrase.ai team’s expertise in generative AI video and audio technology and experience-building text-to-video generator tools will extend our generative video capabilities — and enable us to deliver more value to our customers faster – all within our industry-leading creative applications,” Ashley Still, senior vice president and general manager, Creative Cloud, wrote in the internal memo to employees on Tuesday.
With the acquisition, Rephrase.ai’s investors will likely get a complete cash exit, with the founders being paid in cash and Adobe stock, a source was cited as saying.
The startup, founded by Ashray Malhotra, Nisheeth Lahoti and Shivam Mangla, has raised $13.9 Mn till date. In September, last year, it raised $10.6 Mn in a round led by Red Ventures. Other backers of the startup include Lightspeed India, Silver Lake, 8VC, Techstars.
Rephrase.ai uses generative AI to convert text to video. It helps influencers and video creators build digital avatars and enables marketing teams with the video content.
An Adobe spokesperson said on the development, “Adobe has a strong track record of accelerating growth through both organic and inorganic innovation. We are always on the lookout for new talent and technology that supports our strategy and creates more value for our stakeholders.” Meanwhile, the Rephrase.ai team declined to comment on the matter.
Adobe has been working on multiple generative AI-based products, including within its Creative Cloud suite. These products include editing and workflow management tools such as Premier Pro, After Effects, Audition, Character Animator and Frame.io.
Earlier this year, the tech giant also launched its own generative AI model, Firefly. The move was focused on bringing generative AI tools to its suite of apps and services. Last month, the company displayed its generative AI-to-video capabilities as well.
The move from Adobe comes as India’s generative AI startup ecosystem has been making strong inroads in the segment. According to Inc42’s ‘India’s Generative AI Startup Landscape Report, 2023‘, India’s generative AI startups have raised more than $440 Mn in funding since 2019.
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