Soul Machines, which creates AI-powered customer-facing digital avatars for customers like Google, Sony, and Mercedes Benz, raises $40M Series B led by Temasek
Virtual avatars might well be the future of customer support. According to Juniper Research, conversational assistants …
Context & Ripple Effects
In January 2020, Soul Machines raised a Temasek-led round that would be followed by an even larger Series B1 two years later, making it one of the first heavily funded players in customer-facing digital avatars for brands like Google, Sony, and Mercedes Benz. The raise landed just as Juniper Research was projecting rapid growth for conversational assistants, framing avatars as the next interface for customer support.
The round kicked off a funding wave across the category: Seoul-based Deepbrain AI and UK-based Synthesia both closed comparable Series Bs within two years, and by mid-2025 Synthesia had converted that capital into more than 65K customers including over 70% of the Fortune 100.
First-order effects
- Soul Machines gains the capital to industrialize its avatar platform beyond bespoke brand deployments, with Temasek's backing adding a state-linked strategic investor alongside its existing tech customers.
- Enterprise buyers like Mercedes Benz and Sony get a better-capitalized vendor whose roadmap no longer depends on piecemeal project revenue.
Second-order effects
- Competitors are forced to match the war chest: Deepbrain AI raises a $44M Series B led by Korea Development Bank and Synthesia a $50M Series B led by Kleiner Perkins, turning avatar creation into a capital-intensity contest.
- Hour One's subsequent $20M Series A shows adjacent entrants targeting workplace video rather than head-on customer support, segmenting the market around use case instead of competing only on avatar realism.
Third-order effects
- If the pattern holds, customer-facing avatars consolidate from a novelty purchase into enterprise communications infrastructure — with a small set of well-funded platforms serving most large buyers, as Synthesia's Fortune 100 penetration already suggests.
- State-backed investors like Temasek and Korea Development Bank taking positions points toward national AI-avatar champions, raising the odds of regional rather than global category winners.
The trend: Digital-human avatars are drawing successive, larger venture rounds as enterprises replace text-only chatbots with face-forward AI interfaces for support, training, and internal comms.