Katzenberg and ex-OpenAI Sora lead launch AI video startup

Jeffrey Katzenberg, the DreamWorks co-founder behind Shrek and Kung Fu Panda, is teaming up with Bill Peebles, the former head of OpenAI's Sora video model, to launch a new artificial intelligence startup aimed at building video generation tools for professional filmmakers. The Information first reported the venture on Tuesday, noting that former Dropbox ↗ 1.46% chief financial officer Sujay Jaswa is also a co-founder.theinformation+1

The yet-to-be-named company is in discussions with potential investors including venture capital firm Andreessen Horowitz Ares Capital Corporation ↗ 0.30% for a large funding round, though terms and deal size have not been disclosed. Katzenberg and Jaswa are co-founders of WndrCo, a technology investment firm that has previously backed enterprise AI companies.theinformation+1

A Void Left by Sora

The startup arrives in a landscape reshaped by the collapse of OpenAI's own video ambitions. OpenAI announced on March 24 that it would shut down the Sora app, which went dark on April 26, with its API set for discontinuation on September 24. The company cited resource strain; OpenAI's head of Sora had said last November that the firm's graphics processing units "are melting". Peebles, who led the Sora project, left OpenAI earlier this year.thehill+2

The departure of a top AI video researcher to pair with a seasoned Hollywood executive suggests an attempt to fill the gap Sora's exit created — this time with an industry insider guiding the product.

Hollywood's Uneasy Relationship With AI Video

The film industry has been wary of AI-generated video, particularly after ByteDance's Seedance 2.0 sparked a copyright firestorm in February. The Motion Picture Association demanded ByteDance "immediately cease its infringing activity" after the tool was used to generate unauthorized depictions of copyrighted characters and celebrity likenesses. Disney The Walt Disney Company ↗ 0.69% sent a cease-and-desist letter accusing ByteDance of a "virtual smash-and-grab" of its intellectual property. ByteDance suspended its planned global rollout in March and later signed a copyright pact with the MPA in August.cnbc+3

Katzenberg's Hollywood credentials — he served as chairman of Walt Disney Studios during what is widely considered its animation renaissance before co-founding DreamWorks with Steven Spielberg and David Geffen — could lend the new venture credibility that purely technology-driven competitors lack.sedaily

The Shadow of Quibi

Still, Katzenberg's track record in technology ventures is mixed. Quibi, the short-form mobile video platform he launched in 2020 with $1.75 billion in funding, shut down just six months after its debut. The enormous computing costs that video generation AI demands add further uncertainty. Whether a Hollywood pedigree can succeed where engineering-first approaches have stumbled remains an open question for the unnamed company and its prospective backers.gurufocus+1