German start-up raises $41M to bring sound to AI-generated videos
What's the story
Berlin-based AI start-up, Mirelo, has raised $41 million in a seed round led by Index Ventures and Andreessen Horowitz. The funding will be used to solve a key limitation in generative video: the lack of reliable, synchronized audio. Earlier this year, Mirelo launched an AI model called Mirelo SFX v1.5 that adds natural, context-aware soundtracks and dialog to match AI-created visuals, enhancing realism and usability.
Market competition
Mirelo's unique position in AI video creation market
Despite being resource-constrained and stealthy, Mirelo has managed to carve a niche for itself in the AI video creation space. The company already faces competition from tech giants like Sony and Tencent, which have launched their own video-to-synced sound effects (SFX) models. Other competitors include China's Kling AI (owned by Kuaishou) and ElevenLabs, also backed by a16z.
Expansion strategy
Mirelo's growth plans and revenue strategy
Mirelo CEO CJ Simon-Gabriel told TechCrunch that the company's team of 10 is expected to "double if not triple" by the end of next year. The new hires will support Mirelo's R&D, product development, and go-to-market strategy. The company has published its models on Fal.ai and Replicate, with API usage expected to drive most of its revenue in the short term.
Ethical considerations
Mirelo's approach to training data and artist rights
Mirelo has based its models on public and purchased sound libraries, and is signing revenue-sharing partnerships that respect artists' rights. This comes amid concerns around training data that have plagued other generative AI companies. Georgia Stevenson, who led Index's investments in Mirelo, said the company is aware of these issues but isn't displacing musicians and sound designers with its technology—at least not yet.
Business model
Mirelo's freemium model and future plans
Mirelo is mostly targeting amateurs and prosumers with its freemium model. The recommended plan for creators is priced at €20/month. Simon-Gabriel said creators can't fully leverage AI videos without audio, citing George Lucas's quote that sound is 50% of the movie-going experience. The company has AI music generation on its roadmap but is currently seeing more demand for sound effects due to less research in this area compared to other AI fields.
Financial growth
Mirelo's valuation and future prospects
While Simon-Gabriel did not reveal Mirelo's new valuation, he said it has increased "very significantly" from its previously undisclosed pre-seed round. The earlier round was led by Berlin-based firm Atlantic, which also participated in the new funding. This brings Mirelo's total raised to $44 million and helps close its resource gap. The company is also backed by angels like Mistral CEO Arthur Mensch and Hugging Face chief science officer Thomas Wolf.