AI startup Synthesia gains unicorn status after Nvidia-backed fundraise

Synthesia, a UK-based artificial intelligence (AI) startup, said on Tuesday it has raised about $90 million at a valuation of $1 billion from a funding round led by venture capital firms Accel and Nvidia-owned NVentures.

The startup's technology helps more than 50,000 businesses including Amazon.com in creating custom AI avatars used in instructional and corporate videos.

"While we weren't actively looking for new investment, Accel and NVIDIA share our vision for transforming traditional video production into a digital workflow," said Victor Riparbelli, co-founder and CEO of Synthesia.

AI startups have emerged as a bright spot for investments this year amid a wider slowdown in funding caused by rising interest rates and high inflation.

However, the hype around AI has also deepened concerns that video platforms could be used to create deepfakes, a realistic or fabricated video or image created by AI algorithms trained on copious online footage.

Riparbelli has said that six-year-old Synthesia navigates the issue by only creating avatars of people who have consented.

Startups that reach a valuation of $1 billion are called unicorns.