Xavier Collins: Co-founder & CEO of Wonder Studios

0:00Xavier Collins:Hello and welcome back to Scaling Europe show. I'm Seb. I'm here with Xavier. Xavier, you've got some exciting news to share. Can we just jump right in? We can. Thanks so much for having me on the pod. Yeah, so I guess exciting news is that Wanda Studios is announcing a 12 million seed round today, led by Atomico and some awesome angels across the kind of tech, media, Hollywood landscape. amazing and can you give a quick intro for those who may not know you or know the business what is it that you've built yeah so um me and my co-founder justin um have built wonder studios it's an ai native studio so the way to think about it is an entertainment business for like the next generation so um you know obviously ai is kind of changing a lot of different industries and landscapes and one of the kind of key insights we had is that it's obviously an incredibly powerful creative tool that can unlock storytelling, not just with traditional film studios and people in Hollywood, but also with like emerging artists and emerging filmmakers.

1:12And so it's really about bridging that gap between technology to creatives and unlocking the power that AI basically has. So in a nutshell, how do you make filmmakers founders? How do you make artists entrepreneurs? A big kind of driver of the business is, can we work with some of the most exciting IP, some of the most exciting storytellers? And through leveraging our AI and the creative process, bring those stories to life in a way that would have historically been selling all of your rights to a Disney or a Netflix or whatever it is or needing millions of dollars to produce it so we're kind of bridging that gap helping bring stories to life and that's who specifically you're targeting you're targeting

2:01Xavier Collins:you know there's lots of you know there's lots of ai video companies that we're seeing either in like the training space or whatever but you're really targeting the creative industry right you want to unlock their creative ability and give them the opportunity to build and almost like direct videos without having to to to do it in the old-fashioned way or combined with the old-fashioned way i think yeah exactly like you know i love analogies so you probably get a lot of them on on this but like you know i talk about like the ai gold rush that we're currently in so you've got open ai and google deep mind that are extracting the gold you've got nvidia that are selling the picks and shovels and you've got wonder that's crafting the jewelry and so what that really means is we're taking the gold of AI, but we're melding it with the, you know, platinum of storytelling, you know, editing, you know, directing, et cetera, to create ultimately the content that people are consuming.

2:55And so that kind of comes to life in two ways. One is, you know, as a services business, which is maybe less exciting to VCs, but it's been, you know, a huge success for us. I think that's where we'll, we'll partner with, whether it's like Universal Studios and Google on the Lewis Capaldi music video or Campfire Studios on a documentary or TV commercials or whatever it is. There's a kind of services advertising business, which is just providing high quality video creative content, leveraging AI. But then there's a whole IP side of the business, which goes to your point, which is really around, you know, how do we be the y-combinator of ip and and can we find emerging like the next the next steven spielberg is probably doesn't necessarily have to be you know here in la that they could be uh in cape town in their bedroom and so how do we find that next generation of filmmaking talent and help them get their ideas to market in a way that um yeah it's just never been possible before that's really

3:59Xavier Collins:interesting so you've got the two different the two different propositions the services bit and Can we talk a bit about that Lewis Capaldi video? Because I watched that and it's phenomenal. I don't think you would know. Yeah, I mean, I don't think you would necessarily even think of it as AI in many respects. And so if you watched it five years ago, it would have fit in with lots of other amazing videos of that type, you know? Maybe you would have expected it to be like CGI or something done in a studio, but the quality is amazing. How did that opportunity come about? And yeah, what did that partnership look like?

4:31So thank you very much. I can't take basically any credit. Justin, my co-founder is, is just, you know, incredibly creative, incredibly talented. You know, he, and the, and the whole team that worked with him on it. You know, they, Justin started as an actor, actually on the film 28 days later, and then met Danny Boyles with that process, who became a mentor to him and went on to be like a young BAFTA winning filmmaker and a creative director. in not only 11 labs, but also like traditional kind of marketing, advertising business. So he's done, he kind of came up doing music videos. And so I think what people don't see about the Lewis video, what we tried to do is, I think it's quite cool when you see it, is like be very self-evident about the fact that this was an AI video.

5:22You know, we were trying to push into the stuff that couldn't be done traditionally. so if you see the different characters like the water kind of like coming up when they're when they're sitting there like we were trying to do shots that would have been impossible and never you know never kind of been done before or at least within the time frame which i think was about three weeks to make that video um but you know it came it came about um we have obviously we've got great relationships with a bunch of the different tech companies in the space um that really comes from the fact that you know wonder was kind of born out of community again you know justin set up this this group called real genes back in the day of like all the emerging ai artists and ai filmmakers because when when he started getting into ai obviously the the climate is starting to shift pretty dramatically now where people are like very interested in like how can we use this or what are the benefits of this but when when he got into this early as a creative there was a lot of kind of pushback in the space and so he was able to reach out and start to find like-minded people obviously some of those people went on to be extremely successful and now working at companies like DeepMind or OpenAI or Eleven Labs and so you know we kind of built a reputation early as being a collective of some of the world's best artists in the space and so when yeah when DeepMind and Universal approached us about the project we were like let's let's do it but I think what people maybe don't see as well is it like that was a team of like 10 people behind that video there was there was editors dops um obviously ai artists um but it was like a huge like a multi-person collaborative creative process it

7:02Xavier Collins:wasn't like push a button get a video yeah yeah got it um and on the other half of the business sort of the ip stuff are you have you working with young creators right now who are at that stage of you know creating new characters creating new worlds or stories musicians whoever have you got examples that you can talk to on that side of things i do yeah it's funny you said musicians i actually had dinner last night with an incredible musician uh who's also like got really into ai creativity and video creation who was kind of talking all of like it's it's just a yeah it's funny you mentioned it but the uh the best example we've got is um is the anthology series we launched over the summer.

7:46I think this is probably one of the drivers of the investment round. I'm really excited about this. So the anthology is essentially, it's going to be an ongoing thing, but it's kind of our ode to like Black Mirror or Love Death Robots. And it's this idea of, you know, we released four short films, a fifth one releasing very shortly, where we basically identified four of the best emerging filmmakers in our community. And the idea was that we would basically commission a short film similar to how Netflix does it with like a Netflix original. But the idea is that we would partner with that filmmaker to get their film to life, add value wherever we could, connect them with the different tech companies, connect them with different like voiceover talent or whatever it is to help make that dream that that film a reality um package up those four films into an anthology and then release them over the summer on youtube and then the idea with the filmmaker is that um you know if that short film gets turned into a longer film or a series or a game or whatever it is is actually picked up by a major streamer will actually share the ip 50 50 with the filmmaker so we're trying to kind of build the y combinator of ip is another way of thinking about it um but what's been amazing about that anthology is like it's you know we actually caught on to um nbc news i was i was ill-fated like i got

9:16Xavier Collins:cut from the segment right at the last second but uh the the actual films got on to like nbc news we were lucky to have danny perkins talk about wonder studios uh on our behalf and and yeah i think we've now hit like a million million and a half views of content so that that to me is like a huge project it's going to be continuing and it's like a real example of like launching filmmakers in the space and is that what you want to do more of partnering like that and doing more movies like that yeah i think um 100 you know there's there's different ai studios out there some are looking at like long form trying to make traditional hollywood films you know my honest take is we're too early for that and i don't think people are that interested in in that like i think people are interested in what does a hybrid future look like so we're very interested in partnering you know we've got this really great project coming out with campfire um you know who worked on the menettas brothers and we work and they recently just had number one hit in the uk but um you know partnering with like documentary filmmakers or traditional filmmakers and and having an AI component and it's allowing the film or the documentary to get made like that's very interesting to me um but the anthology stuff that's definitely a focus because it's going to be a long journey I think it's it's about you know it's about unearthing that next generation of talent and so for us you know success is if I'm honest like we'd love to see one day one of the filmmakers that goes through our anthology goes on to work at a major studio uh work with a major studio and win an oscar one day like we're not trying to right now for like an ai long film we're trying to like unearth talent and then be part of that ecosystem as it evolves yeah it's like because yeah like you said the yc or like a launch pad for for young creatives and it's almost like in in the tech world like a sort of mvp or lovable version right or like give them the ability to to build a mock-up to test something in in your kind of studio um and and some of the some of the the quality is insane a lot of these short form videos um and they are really gripping you the amount of emotion that can be packed into some of these um like ai generated videos is still incredibly high you know there's actually no less high than any other than any other any other type of video i don't think a lot of this a lot you know a lot of it's going to come down to the quality of the storytelling.

11:50Like, I think the, you know, the kind of key insight is, you know, the first big revolution in entertainment was YouTube, or like the last, sorry, the last big revolution in entertainment was YouTube, where all of a sudden, anyone had access to their own TV channel, you know, anyone could distribute their content around the world, which made like that created a proliferation of content. You know, now with AI, you've got the barriers to Hollywood with great production being lowered and being lowered every week, you know, with each new model release. But what's still going to matter is, like, what is the quality of the IP?

12:29What is the quality of the storytelling? Because that's what's going to cut through. And obviously, how good is your distribution? And so those are two of the things that we're always thinking about, is, like, how do we identify great craft, great storytelling? And there's definitely, like, there's craft in terms of, like, how can you push the tools in AI? um maybe not just to like cross the uncanny valley but how can you how can you push a creative angle that wouldn't have been possible like the lewis video um but then also like what makes a great story what what captures people's imagination and just to the mvp point i think that's probably like a it's a really good point because that's probably like a good example of the cross between justin and i you've got you know traditional filmmaking way of seeing the world and then from my background obviously building and scaling tech companies i'm always interested in like how do we get a mvp like how do we test and so with ai for the first time ever you can actually run pretty quick tests on different pieces of ip you know without needing to spend 40 million dollars before you make an entire huge film you can actually test what the audience like what audience is like and what's a high potential story yeah yeah and yeah

13:42Xavier Collins:It's a huge leap forward from anything that's come before. Normally, you'd have a screen test at the end of production, and you'd show some audiences and see what they think of it. Whereas now, you're bringing it way further forward. Let's go back to the round quickly. You raised a big seed round,$12 million. It's got a really interesting range of creatives and industry experts. what was the rationale behind getting those kind of people on board as well? Was that to kind of like help you foster that community, to build the expertise? Yeah, can you touch on that a bit? For sure. I think, you know, something just to say on the round is like people always see that the success or the headline and, you know, having been a founder before and knowing a lot of founders out there, like, you know, raising money is an absolute grind.

14:42always. And there's, there's always more people that don't get it or don't believe in it than the ones who do. But, you know, we were extremely fortunate to kind of partner with Atomco on this who are an incredible fund. And the team there have a very strong thesis about the way this world, the way the world is moving in this space. And, and so, you know, I think generally when you look across the angels and the investors that we brought on, we were in a lucky position where we had a lot of demand in the end for investing in this business. And so we really tried to optimize for people that believed in the mission, truly.

15:27We're kind of like huge, actual champions, actual supporters. I think one of the things that's also very interesting, like having been an angel and worked with angels is, you know, often it's kind of like a power law. It's like there's a, it's like when you have like affiliate schemes or referrals, it's like 20 % of the people do 80 % of the referring. It's like, it's kind of the same with investors, if I'm honest. Like I think, you know, often you're trying to find like, who are those investors that are the actual champions of the business and try to optimize for working with them. So, you know, obviously incredibly you know blessed to be able to work with atomica we also were able to raise from adobe ventures which i think is um you know we're so excited about it i think it's a real testament something i didn't mention before and like you know uh sometimes intentionally but i think it's worth just double clicking on it's like underneath the the business model which is the services and the ip model there's actually a whole technology layer that we are building now you know we're not we're not building underlying models but we're kind of going up the value stack and we're thinking about the problem of when when creators are making videos like the lewis music video as i said there were 10 people on that project how do they collaborate together where are the things that take the most amount of time that are quite arduous how do we unlock for example like if we want to work with a traditional director from Hollywood who may not be like as as fluent on the AI tools how do we unlock their ability to cook alongside us and and to kind of collaborate in one workplace and so we are building proprietary workflows that sit underneath the IP that we're creating and the agency stuff that we're doing and I think having Adobe come on board is is a great signal there and it's obviously like a testament to the fact that they saw there's a huge need for this type of solution.

17:23There's a lot of people trying to solve it, but that was a great statement of competence. And then obviously, just incredible to have. We ended up getting a bunch of executives across some of the world's biggest marketing companies, some incredible people from Hollywood. We obviously got Danny Perkins, who was the CEO of Studio Canal as an advisor and close friend. And then obviously, uh in the kind of tech community angels from open ai and the founder of 11 labs maddie who's a legend um so it was it was a great crew of people in the end and and a lot of hard work but chose them all because they believed in it and all in their own way can like unlock a lot of value for

18:05Xavier Collins:the for the business yeah a real amazing blend of uh creatives experts in video and then experts in ai which is like ultimately exactly what you want um and going back to what you're mentioning about kind of that that layer of technology kind of that sits under underneath everything is that sort of like um like editing tools and software collaborative tools is that kind of what it is so that you and i could be working on a video simultaneously is that that kind of software layer it's yeah so i think like there's two ways of explaining it it's probably just to a bit is like one of the biggest problems in AI creativity is like the 100 tab problem, which is that, you know, you're using all these different tools across like all these different browsers.

18:52You're sending prompts over here. You know, this is definitely, this is Justin's world. I'm not sending prompts over here and over there, but like when you see them cook together, it's like there's, it's chaos. There's like a hundred tabs. There's like different Google Hangout links. there's different like ways of sending over the files and so you know something that we're trying to drive down on is like just just part bit by bit focus on the elements that are taking the most amount of time that are complicated something that we're quite interested in is like this idea of the storyboard so you know when when we when we work with filmmakers or documentary makers and you know traditional directors and we're kind of um showing them like what could a scene look like or how could we envisage this?

19:35You know, we like to throw it up on a storyboard. And so if you take that as like a one kind of rallying point for the different creators, how can you have a storyboard canvas that actually allows people to make comments, move things around, make changes kind of in one place? That's like a very kind of key problem. You know, another one that is also just like, probably this is more, this is like more boring, but I think like super important to the success of the entire space is, you know, when you're working on these major projects, and we were lucky to have like an ad in Times Square with 11 labs.

20:14And we had the, you know, the, obviously the Lewis stuff and there's, there's others I sadly can't go into. But when you're working on a project of that scale, one of the things people are very interested in is like, you know, how do you get to the output? You know, and, and do you have like, do you have a system of record for like the prompts you use to create the output. And so again, if you've got lots of different creators working on a project, you know, you want to have a system and a kind of engine where like that stuff is stored and tracked and, you know, you're able to reproduce, like this is how we got to the end output in a way that's going to satisfy like some of the biggest companies in the world.

20:50So less of an exciting feature, but just an example of something that like is needed and a gating factor to the space succeeding.

20:58Xavier Collins:Yeah, that makes sense. It's really interesting. Yeah, it's one of those things that you wouldn't necessarily think about as like an individual creator, being a problem that everybody has when they're doing these prompts. And you're right, like the paper trail of prompting, yeah, it spans like multiple models. And it's like, yeah, you're right, all over the place. And going back to the round, you know, it's a big round, $12 million seed round. What are you going to be spending and investing that cash on? um so there's i'd say there's like the simple answer is is building out the ip side of the business and investing in the technology um you know the engineering team has grown from from one a few months ago to now five and we're really um excited to bring on the team from playbook 3d um Skylar and JD, these guys are amazing entrepreneurs.

21:52They'd raised a few million for their original business and like super technically strong, have been cooking in the space for years. And so bringing them into the team has been an absolute step change. So I think we're really interested in like, how can we double down on the technology side? Because I think that's going to be a key part of the equity story moving forward. And not only that, but like in order for us to scale some of the stuff we want to do, you know, we're going to need to be faster, more efficient. And so like, there's, there's, there's a lot of investment there. And then if I'm honest, like we're, we're really interested in like, we're, we've just launched our office in New York.

22:28We've got, I think we've got about five people there now full time, which is great. I'm obviously out here in LA right now hiring people. But where we'd love to be is, you know, a kind of small hub in LA, a small hub in New York. And then we really want to invest, you know, back home in London, you know, particularly like Justin's home in East London, hiring and training up like that next generation of creatives. And so that's a big focus for us. How can we kind of be a beacon of talent locally and start to train up like traditional creatives on these tools so we can meet the scale that is no doubt coming?

23:10Xavier Collins:and with the ip stuff i imagine it's it's a long-term play or are you expecting it to you know i guess with some of the the ideology stuff like it's some of it does i guess show quite quickly but i imagine it's a bit like venture capital generally right you look at the yc model it's like a 10 15 year cycle that you hope to get returns when these things really blow up and that may that may take years does that impact the way that you're thinking about the business and growth it's it's such a great question and and the answer is like if we were just doing the anthology the answer is like 100 yes like that's that's a that's a vc style model now i think it's a little bit easier because the the this like the one distinction with the vc model is like there's there's obviously a power law in vc and you need to spend millions and millions of dollars um you know the vc model is kind of similar to the traditional hollywood model as well if i'm honest Like it's a very hits driven business.

24:06AI is changing that slightly because you're able to produce things at a much lower cost. You know, the return profile is a bit different. So like, I think that's still to be determined. Like, what does that business model look like so much with the anthology? I think excited to see where that lands. but outside of the anthology, there's a ton of stuff we're doing in IP that I think can have a lot faster payback period and is a huge opportunity. So, you know, can't go into like a huge amount of detail on it but one of the things we're doing is partnering with the, it's one of the fastest growing kids books in Europe.

24:47They've sold over 5 million copies and we're spinning up a kind of mini YouTube series in partnership with them as a joint venture And so, and one of the things we're looking at doing, like leveraging Eleven and AI is translating the dubbing those kids episodes into multiple languages. And so I think there's a huge opportunity, particularly in kids animation. You know, again, amazing to have Danny kind of advising the team. He was at Studio Canal when they made Paddington. And we've got some incredible people across the board who have worked on some of the biggest kids animations ever. And so I'm really interested in, like, can we find emerging IP, particularly in that space, that already has an audience?

25:41It's like a really, like, let's just say it's like a really successful local story in one European market. And can we make that a global success? and I think for the for the storyteller for the writer this is an unbelievable chapter in history because historically they either would have had to have sold all their rights to Disney or you know another studio or they would need millions of dollars to kind of front run the animation costs whereas like for the first time ever this is kind of putting more ownership in the hands of that author and you can get many episodic content out on YouTube to the masses and build an audience and build a brand relatively quickly so i think i think projects like that um have a lot of potential to turn into like pretty quick uh revenue successes no that's super interesting i um i was actually i'm trying to do some more content on tiktok and

26:36Xavier Collins:i was literally just on tiktok before this call and i saw it was almost like a david attenborough style video but of pokemon and it was like you know narrating the lives of pokemon in the wild and obviously all AI generated but people were commenting on it like wow I would watch this all day every day if this was like you know on Netflix or something um so there's definitely yeah I think yeah it's like an amazing opportunity to bring something to life in a whole new format and a whole new way that hasn't that hasn't been done before it's it's funny with stuff like that like that's just just something like there's there's there's some like super creative funny people out there like some of the trends that go blow up on on TikTok or X or whatever like with what people are doing using Sora.

27:16I think, you know, that's, that's obviously a market. I think the thing that we need to be very cognizant of is like, what's going to be an enduring piece of IP. Um, and I think that's where like the bridge to like the traditional industry is going to be so important because they have really nailed like storytelling.

27:33Xavier Collins:Yeah. Um, but, uh, yeah, no, I'm, I, that's, that's amazing. That's the thing like this, there's so many applications of this, that is also part of the challenge it's like where do you focus yeah so that's why like we do kind of bring it back to like what is an enduring story what is a piece of ip that like has has kind of stood the test of time has millions of fans and audience and how do we then bring that into like a new medium at a scale that was not possible before yeah absolutely and like it's yeah it's it's an amazing idea and i think you know if things go well you're going to be creating the future generations of you know amazing bits of media and content and tv programs in short form and you know propel the careers of like young creatives forward which i think is an amazing mission uh but look thank you so much for joining me like congratulations on the round and i look forward to following along and i'll be like tuning in to all the the videos and the creatives and seeing what they produce i appreciate it you're a legend thanks thanks man no no worries