00:00The AI video company is opening new hubs in London, Tokyo and Paris with plans to invest nearly $300 million
00:06over the next few years as its scales, as its business and also its AI research.
00:11Joining us now is Runway co-founder and CEO, Christabel Valenzuela.
00:15So I think there's a clear link here from where your priority markets are and where you're growing fastest and
00:22where you've opened up these hubs. Explain that.
00:25Yeah, I think it's a version of the same, to be honest. We're growing really fast, of course, in the
00:29U.S. That's our biggest market.
00:31But we see natural expansions happening both in Asia. So a couple of months ago, we announced Japan and our
00:37office there and our presence there.
00:39I've been spending a lot of time in the region and our growth there is consistent.
00:43So we want to make sure we have more time and more people just in that region.
00:48And more recently, we opened up two European hubs. We announced London, London and Paris that we're announcing today.
00:55Both of them are on the heels of just growing the markets and are being close to our customers.
01:00Europe is our second largest market and Japan is our third.
01:05We're also making inroads in Latin America. So Brazil will start becoming also a hub and, of course, Mexico.
01:10And so for us, it's more about making sure we're close to our customers, we're close to how we're serving
01:16them, and then talent.
01:17Talent these days is broadly everywhere. So we need to be also everywhere to hire the best people we can.
01:23That $300 million commitment, how much of it really is talent, the cost of talent?
01:28A big chunk of it is talent, specifically research. As you know, researchers are expensive and talent is expensive.
01:34And so people is what makes this company really special. And a lot of it is definitely dedicated towards not
01:40only growing our research team, but our go-to-market team.
01:43In Japan, it's kind of interesting because we've grown a lot there.
01:48And traditionally, everyone will tell you that in Japan, you need to have a commercial team, a business team, just
01:53to be able to sell one contract.
01:55And that hasn't been the case for us.
01:57We actually have been able to sell into Japanese enterprises and Asia with no commercial presence whatsoever.
02:04And so really for us, it's ability to double down and make sure we can sell more by having great
02:09teams and great people there.
02:10And now we're kind of putting time and effort and money into that.
02:13The debate facing, I was going to say Hollywood, but industry at large right now, has been, you know,
02:21what will the impact of AI be on content creation, you know, for want of a blanket expression?
02:26How much has that shifted, Cristobal, to not whether they should, but how they should use the technology?
02:33Well, I think the question of, like, will AI ever be useful in creative and content in Hollywood, it was
02:39really a question two years ago at the most.
02:41I think these days you could assume, and it's fairly common to assume, that every company, every media, every studio
02:47is using AI somehow.
02:49I mean, we work with all of them.
02:50So we can tell you, like, from the inside that that's actually the case.
02:54And so companies are seeing, like, significant impact in their business by using the technology that models themselves to make
03:03content you just couldn't do before.
03:05And we have countless cases of, I don't know, the BBC using it to create content you just couldn't do
03:09before.
03:10Studios using it to create storyboards or art directions or edits of things.
03:16And so for us, that's kind of, like, resolved already.
03:19You know, Hollywood and media has been all over and has finally fully adopted AI.
03:24We now need to grow really outside of that.
03:27On the studio side, the Lionsgate relationship is really interesting, right?
03:31That you're co-developing on projects, but they took an equity stake.
03:35Correct.
03:36Why?
03:37But also, is that something you feel like you could replicate with other studios?
03:41Yeah, we're replicating it related with other studios.
03:43Again, if you're a great technology partner to a lot of the studios, what you're bringing to the table is
03:49the ability for the studios to create content you couldn't do before.
03:53And Lionsgate was one of the first and the most vocal kind of proponents of this.
03:59But really, we're working with a lot more studios and companies with similar models.
04:03Some of them don't involve equity at all.
04:05It's more about partnerships and our ability to integrate our products into the way they work.
04:11And there's so much great IP.
04:13There's so much great content out there that needs to be made somehow.
04:17And so, if you can help them make it, they just want to partner with you.
04:21And that's kind of what we've done to make sure that hopefully we'll get to see more interesting stories out
04:25there.
04:26Cristobal, just very quickly, where is Runway in its efforts to raise money, need to raise money to fund all
04:32of this?
04:34We've raised almost like every 10 to 12 months.
04:37And so, we're pretty much probably going to go into that trajectory.
04:40We closed our Series E on late last year, so December of last year.
04:45So, hopefully, later this year we'll announce something.
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