Character.ai, a 16-month-old AI chatbot startup founded by two ex-Googlers, recently received a $150 million cash infusion from Andreessen Horowitz, leading to a $1 billion market cap. Despite not having any revenue yet, the company’s idea is to host various AI-powered personalities, including celebrities, anime characters, Twitch streams, and historical figures, for users to interact with via text.
Users can ask questions or chat with AI-powered companions they create in the app, which is marketed as an alternative to Replika. Customizable companions are the app’s primary focus, rather than simply allowing users to chat with algorithmic celebrities.
“Character.ai’s power is our highly-sophisticated language model, which rapidly analyzes and contextualizes large volumes of information to produce useful intelligence tailored to each individual,” company CEO Noam Shazeer said in a press release, “making it a personalized superintelligence companion that enhances productivity, offers advice, educates, and entertains.”
“The potential use cases,” he added, “are infinite.”
While the term “Superintelligence” may be a bit of a stretch as a marketing ploy, it’s hard to argue against the appeal of personalized, AI-powered companions that you can keep in your pocket. This is the idea behind Character.ai, a startup that recently received funding from Andreessen Horowitz, a firm known for its optimistic views on AI.
This move doesn’t seem out of place, considering the success of Replika, a similar app that has faced its own set of challenges. Some users have engaged in verbal and sexual harassment of the AI programs, leading to the shutdown of the sexual component of the app. While this may have been an expected function of AI, the company had to take action to protect its users.
While the app is currently free, the creators of the app have stated that they plan to introduce a subscription model as an additional option. They are also exploring the possibility of incorporating an ad-based model to generate revenue.
It seems that in Silicon Valley, simply mentioning the term AI is enough to attract a significant amount of investment in recent months. Hence there is no need to sell to consumers if they are in already being sold to VCs.