AI lets anyone create videos, but many AI video creation tools lack support for audio. Mirelo is building AI that adds soundtracks to match the video’s action.

Earlier this year, the Berlin-based startup released Mirelo SFX v1.5, an AI model that interprets videos to add synced sound effects (SFX).

This attracted attention from VCs gearing up for a generative AI revolution in games. The two-year-old German startup has raised a $41 million seed round led by Index Ventures and Andreessen Horowitz, TechCrunch learned exclusively.

This new capital will help Mirelo compete more effectively in its emerging category. While it was still in stealth mode and resource-constrained, large companies such as Sony and Tencent released video-to-SFX models. So did Kuaishou-owned Kling AI, out of China, and ElevenLabs, which is also backed by a16z.

While Mirelo already differs from them by its narrower focus, beating these models in the long run requires the startup to make additional hires. Altogether, the startup expects its team of 10 people to “double if not triple” in headcount by the end of next year, Mirelo CEO and co-founder CJ Simon-Gabriel told TechCrunch.

These new hires will support Mirelo’s R&D, as well as its product and go-to-market strategy. The startup published its models on Fal.ai and Replicate, and expects API usage to drive most of its revenue in the short term, Simon-Gabriel said. But it is also investing in building out its workspace for creators, Mirelo Studio, which could eventually support full professional use.

As Mirelo prepares to scale, the startup and its investors are also anticipating concerns around training data that have dogged other generative AI companies. According to Georgia Stevenson, who led Index’s investments, Mirelo based its models on public and purchased sound libraries, and is signing revenue-sharing partnerships that respect artists’ rights.

It’s a tension inherent to generative AI tools, but Mirelo isn’t displacing musicians and sound designers — at least not yet. With a freemium model including a recommended plan for creators priced at €20/month (approximately $23.50), the startup is mostly targeting amateurs and prosumers hoping to unmute AI-generated videos.

According to Simon-Gabriel, creators can’t fully benefit from this new potential without audio.

“George Lucas said that sound is 50% of the movie-going experience. It’s not an overstatement,” he said. “If anything, it’s an understatement. You can take exactly the same images, and the sound will shape a completely different ambience, depending on the sound and the music that you put in there.”

He and his co-founder, Florian Wenzel, are both AI researchers and musicians themselves, and the startup has AI music generation on its roadmap. But Mirelo is seeing more pull for sound effects, in part because there is less research happening than in other AI fields, Simon-Gabriel said.

“It’s easier to build a real moat here, and then to capitalize on it,” he noted.

This could pay off for Mirelo. Simon-Gabriel declined to disclose its new valuation, but said it had increased “very significantly” compared to its previously undisclosed pre-seed round. That earlier round was led by Berlin-based firm Atlantic, which also participated in the new funding, bringing Mirelo’s total raised to $44 million and helping close its resource gap.

The startup is also backed by angels who lend credibility to its technology and could open new doors, including Mistral CEO Arthur Mensch, Hugging Face chief science officer Thomas Wolf, Fal.ai co-founder Burkay Gur, and others.

Still, the team is aware that AI-generated videos may not be mute for long.

For instance, Gemini’s video generator now incorporates soundtracks powered by DeepMind’s Veo 3.1 video-to-audio model. But if anything, Simon-Gabriel sounds vindicated. “Now, suddenly, people realize, ‘Oh, maybe we should add sound.’ But, of course, you should add some. It’s a bit like silent movies versus talkies, right? It does make quite a difference!”

Anna Heim is a writer and editorial consultant.

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