Last week, Snapchat confirmed it bought Ukraine-based augmented reality (AR) startup AI Factory. Before its acquisition, the company developed the Cameo AR feature for the popular platform. Though neither firm has commented on the terms of the transaction, Ukrainian news site AIN states the deal was worth $166 million.
As part of the agreement, some of AI Factory’s 70-person staff will be integrated into Snapchat’s Santa Monica, California office.
Why Snapchat Purchased AI Factory
Put simply, Snapchat made its latest acquisition to bolster its engagement figures.
Founded in 2018, AI Factory specialized in developing artificial intelligence (AI) enhanced filters for mobile applications. For Snapchat, the firm developed Cameo, which allows users to insert their selfies into short animated clips. Similar to deepfakes, the feature maps new images onto existing video in a convincing manner.
Thus far, Cameo has proven highly popular among Snapchat’s subscribers. According to TechCrunch, 70 percent of the application’s daily active user base has utilized the feature. Ideally, the firm will provide its new parent company with its features that will delight and enthrall Generation Z.
Furthermore, Snapchat has previously been well served by AI Factory’s leadership. CEO Victor Shaburov co-founded a software company called Looksery in 2013. Two years later, the social media company purchased the startup for $150 million. Subsequently, the corporation used its new acquisition’s technology to develop Lenses, an AR filter that allows users to add animation to their photos and videos.
By 2018, 70 million Snapchat subscribers, a third of its entire user base, utilized Lenses.
After selling Looksery, Shaburov served as the social network’s director of engineering until leaving to form AI Factory. As such, Snapchat may have viewed its latest purchase as a way to bring Shadburov back into the fold.
Snapchat’s Commitment to Innovation
Launched in 2011, Snapchat has carved out a niche in the highly competitive social media space by continually innovating.
Initially, the firm let users communicate via sharing short and ephemeral clips and photos. Over time, the company gave its subscribers the ability to send “Mission: Impossible”-style direct messages and make video calls. The firm also developed technology allowing the public to bring cartoonish imagery to the real world with a popular AR tool.
Consequently, the service has grown its daily active user base to include 210 million people worldwide.
Admirably, Snapchat has not rested on its laurels as its popularity has increased. In March 2019, the Burn-In reported the platform began work on an in-app games service that launched last summer. Five months later, the corporation raised $1 billion in short-term debt to finance further AR development.
Besides, Snapchat released the third iteration of its smart glasses product late last year. The Spectacles 3 allowed wearers to see the world in beautifully rendered animation and record HD photos and video. The company also announced plans to launch a dedicated news service sometime this year. With it, users will be able to keep up with current events without ever leaving the app.
With AI Factory now under its umbrella, it’ll be interesting to see what innovations Snapchat unveils in the new decade.