DreamWorks Co-Founder Jeffrey Katzenberg Talks AI Advertising
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Thrivent, where money means more. Artificial intelligence avatars. The Arizona Supreme Court is using the tech to simplify and report on court rulings with the public. Now, these avatars were made by a company called Creatify.

It's an AI video ad platform that just raised about $15.5 million in a Series A funding round, co-led by WonderCo and Kindred Ventures. Pleased to say joining us now to discuss that is Jeffrey Katzenberg, founding partner at WonderCo, and Inan Na, the co-founder and CEO of Creatify. Welcome to both of you. Great to see you, Jeffrey. And Inan, I want to start with you because I'm absolutely fascinated by what you're doing. When somebody told me about Creatify, my first thought was,

Why would I need this? Is this for playing games? And someone pointed out this Supreme Court, the Arizona Supreme Court, using this as a way to sort of explain these rulings, explain what's on the public docket. Can you just explain to me how you came up with this idea, and did you expect it to be used in that type of application?

Thanks for having me. So we started this idea from my experience working at Snapchat, or how to build a Snapchat video platform called Spotlight. So we realized there is a tremendous demand for this short-form video.

There's all the advertisers want to run on ads with the short-form video platform formats. And so we inspire us to create this idea to use AI to radically make the video creation easier. And to be honest, we didn't expect the use case you just described, but we are actually applying our video technology to different use case, starting from advertising. Now we are seeing new use case like what you just mentioned. And it's very fascinating.

So, Jeffrey, I am curious as to how you came about this. Of course, you've been investing in a lot of companies in the entertainment and the tech space, and it's all kind of, of course, we now see this is all kind of merged together. Calling it tech media is kind of a mood at this point. When you came across what Enon was doing, what was it about it that made you take interest?

Well, I think a couple things. So one, storytelling tools have always evolved and I've always been looking for whatever the best tools are to put in the hands of storytellers.

Great technology turns storytelling into really a creative and a business success, which is in fact what Creatify does. The thing I keep coming back to and just feel so strongly about is that human touches everything. AI, it follows vision, direction, and feedback. And so Creatify isn't replacing the marketers, it's actually amplifying them.

Does it worry you, Jeffrey, that at some point it's going to just take away jobs on the creative front? I mean, I know this is just one slice and it's not necessarily like writing or directing a movie, but you can see how we'd get there. Again, I come back to the human touch here, I think is just absolutely essential and fundamental.

And so the answer is, what I think it does is it democratizes storytelling. So as a perfect example here, what Creatify does very specifically around advertising, and advertising is very much a storytelling enterprise. And it takes something that would cost many, many tens of thousands of dollars and maybe take four or six or eight weeks to

and it actually is able to do it in minutes and at a fraction of the cost. And so what that means is that you have the best tools in the hands of more people than ever before. And out of that is going to come great work, great creativity,

and I think ultimately business success. You know, and Jeffrey brings in that human touch element, which always raises the question of the inputs, right? Like the LLMs, the large language models, where you're getting the source from to then fuel the AI and the copyright issues surrounding that. How are you guys thinking about it?

So we actually take a lot of data from the brand itself and we augment it using our AI. So the way it works is we'll take the information from the brand and we ingest into our video generation model. And our video generator will be able to analyze all the information and be able to generate very personalized, tailor-made advertising content for each brand. And we take like

data privacy and trust and safety very seriously and we have very strict counter moderation rule to make sure all the data are used properly.

Is there a sense, though, Inan, and when we talk about the use case for this, what do you think the trust level for users are going to be? So we use this as an example of the Arizona Supreme Court, and it's a certain practical application. There's been other cases where people have tried to use AI avatars in courtroom functions without necessarily informing the court that they were using them. That's led to a lot of laughs, but it's also raising about a question about what I can believe with

with my own eyes? How do I know what's real when I see AI has gotten so good? Yeah, definitely making a lot of change to how advertising works. And the way we use it, we use AI to really empower a lot of business because traditionally for a small business owner, if they want to run video advertising, it costs thousands of dollars two to four weeks. And it's very cost-effective.

prohibited with Qredify we actually can empower them to be able to create like a video ads within minutes and be able to grow their business. So we, what we do here is really to empower like entrepreneurship, empower business so they can actually focus what matters to grow their business. So that's also the vision of Qredify. But Romain, it does, well, listen, it does raise a point here, which is should there be guardrails?

And the answer I believe is yes. But of something that is so young and is evolving so quickly, the balance here is between extraordinary speed of innovation

and protection, and whether it's protection around copyright or it's protection around truth and fact. You know, these are super important issues, and I don't know that we have the answers yet, but clearly there need to be some guardrails.

I want to, well, let me go in the creative space, particularly given your background, Jeffrey, obviously founding DreamWorks and your time as a chairman of Disney Studios back in the day, kind of when movies were made still the old-fashioned way. And we've seen the evolution of technology and now artificial intelligence in movie making as well. There was recently an interesting use case, particularly in the latest release of Fortnite, and the use of AI with some of the voices in there.

I don't know what the business terms of that were, what sort of contracts were signed, but it seemed to raise a lot of hackles about fair use, about transparency of use. And I am curious, particularly in the creative fields, how you see this evolving. I know it can be complementary to the human creative, but will it be? Will we as humans be willing to accept that?

Well, you know, that's on us. I mean, I would say to you, yes. And, you know, it's interesting because if you go back and you look at how, you know, the evolution of these, you know, tools, you know, you look at animation going from a 2D business into, you know, a CG business, hand-drawn into state-of-the-art computer animation was an amazing disruption.

And yet animation today is bigger than it's ever been. And there are more people employed working in it than ever before. The jobs, some of which have been reinvented, some of which are new, some of which have gone away. But it has absolutely been a tremendous positive impact.

on the business and I so I look at what's happening today I don't think this is an evolutionary moment it's a revolutionary moment it's impossible to see these incredible new releases whether it's VO3 coming out of Google or the things that we are seeing coming out of OpenAI and Anthropic it is breathtaking it's happening so fast

that I think there is anxiety of can we keep up with this? Can we manage it in a productive way and one that protects, you know, creative rights and all the things that surround that? Well, Jeffrey, to that point, no one would have seen this evolution coming in Hollywood, for example, right? It's been quite a ride. And COVID totally disrupted the industry also, so you got to add that on to it.

Fast forward for me five years. What does Hollywood and the movie industry look like in the AI world and in reality? Like, we're all going to be watching bots on YouTube? Like, what is it?

I think it's many things is the answer to that, Alex. I don't think it is just going to be one size fits all here. Do I think there are going to be movies and movie experiences? Absolutely. For anybody that went to the movie theaters this past weekend, the biggest memorial weekend in the history of the business with two incredible movies, yes, there's a future for that. People love that communal experience. On the other end of it, you see TikTok.

And you see what creators are doing today and YouTube has never ever been bigger than it is right now. And so I'm very optimistic. I do think there are new forms of storytelling of which these tools are going to be accelerants to that, if not catalysts to them occurring.

I don't believe it's the end of Hollywood, not even a little bit, I think probably just the opposite. Will it function in the way that it has in the past? Absolutely not. You know, at the Walt Disney Studio, we had 130,000 frames of film, every single one of which was drawn by hand with a pencil and then inked and painted by hand, and then Toy Story comes along, changes everything.

And the outcome of it ultimately was great success for Hollywood, for storytelling, creators, for business.

As long as we all know that we still need financial anchors on television. That's the important part. We never want to lose that. That's existential. It's not essential. It's existential. That's right. There you go. Thank you, Jeffrey. I appreciate that. As long as they have good skin care, which I learned about while we were waiting for you, I think that's an important perk that needs to go with the job. I think it's important. I think there should be a budget for that.

Inan, to put this into perspective, talking about utilizing AI in many different forms, it's a yes and, it's not an or. Who are some of your customers right now? What kind of brands use your product and how are they using it?

Yeah, we have a range of different customers from SMB owners to marketers to agencies. And recently we also got amazing traction from very big brands like Alibaba, Soundperks, Hotspot using our tools. So really serving them with their marketing needs and also all their performance marketing team are using our tools. And how do you expect that to grow? What other kind of brands are you targeting and what's your pitch to them?

So basically we started about by building this like AI AdMaker, which is a video question tool. But now we actually evolve into an end-to-end video ad solution. Now we have not only helping brand with just ad question, we also help with the ad research, which is before the question and after question, we help them to deploy to different platform and doing the optimization. So really it's a one-stop shop for all your performance marketing needs.

So, Inan, just tell us here, I mean, I'm going to give you the final word here. I mean, where does this go next? I don't mean just for Creative5, but overall. I mean, you've built something cool. You've raised some good money. Obviously, you've got a long way to go to sort of get up to the heights that we've seen with other companies in this space. But when you look at the foundation that you have, you look at the adoption of AI and AI-adjacent technology, what do you see as the future?

we see the future is there are going to be like a very intelligent ad agents which pretty much can automate everything along the performance marketing journey right you can think of like the best teammates who specialize in paid ads can take care of everything from like the inspiration to the creation to the delivery and the final optimization and they can do it continuously so really we're gonna free like marketers like brand

from like the manual tedious work and let them to focus more higher like higher all their tasks right doing the designing messaging or grow their business I think that's the vision we are envision at 35

We really appreciate your time today, both of you. Thank you so very much. Good luck with all of that. Please come back and let us know how all of it is progressing. Jeffrey Katzenberg, founding partner of WonderCo. He's going to go out and get some skincare in just a second. And Inan Na, co-founder and CEO of Creatify as well. Thrive-In can help you plan your finances for the people, causes, and community you love. What makes Thrive-In different? Financial services and generosity programs are combined to help you build a financial roadmap for the future.

while also creating opportunities to give back along the way. Visit Thrivent.com to learn more. Thrivent, where money means more. This is an iHeart Podcast. ♪