Less than 30 people have created an AI company with a valuation of 1 billion. How does Character.AI create a virtual companion?

Recently, there has been a lot of turmoil in the AI circle.

The top-streaming ChatGPT experienced a drop in traffic for the first time in June this year. Emad Mostaque, the boss of Stability AI, the leading AIGC company, was also exposed to scandals such as stealing other people’s technological achievements, defaulting on employee wages, falsifying academic qualifications and work experience, and exaggerating company income.

However, ups and downs are normal. ChatGPT launched iOS and Android applications, and Microsoft also announced that Bing Chat will log in to third-party browsers such as Google and Apple. AI models are blooming everywhere, and the grand occasion remains.

And another AI company, Character.AI, a newcomer favored by Capital, is negotiating with investors for a new round of financing. In March of this year, the company had raised $150 million in a new round of financing led by well-known venture capital firm Andreessen Horowitz, valuing it at $1 billion.

The company, founded by two former Google employees, launched an early version of its software back in September last year, allowing users to create and interact with chatbots. The new funding will help Character.AI cope with a surge in demand for its chatbots.

Under the dark clouds in the industry where AI is questioned about the capital bubble, why does the start-up company Character.AI stand out from the encirclement only with chatbots? Its technical team and product features are worthy of careful attention.

01 A team of less than 30 people, tens of millions of chatbots

Similar to ChatGPT, Character.AI is also a chatbot application that supports web and mobile versions. But the difference is that Character.AI has a stronger ability to empathize.

Founder Daniel De Freitas was intrigued by the concept of virtual friends as a kid.

When he and Noam Shazeer were working at Google, they developed the chat robot LaMDA based on the Transformer architecture invented by Google Research. However, considering the brand risk of Google, LaMDA was not released. They wanted to share this technology with as many people as possible, so they founded Character.AI.

Some users even say that Character.AI is like their counselor. The biggest advantage of Character.AI is its user-centered product design, users can fully customize their own AI chatbots to relieve loneliness, which seems to be better than the Pi launched by Inflection AI we introduced earlier.

On May 23, the mobile version of the artificially intelligent chatbot platform was launched to iOS and Android users worldwide. The app surpassed 700,000 Android installs in its first 48 hours, surpassing top entertainment apps like Netflix, Disney+, and Prime Video. Gained over 1.7 million new installs in less than a week.

Before the app’s launch, the web app received more than 200 million monthly visits, and users spent an average of 29 minutes per visit, which the company says is 300 percent higher than ChatGPT. To date, users have created more than 10 million custom AI characters, the company added.

It is worth noting that the creative team of Character.AI is less than 30 people.

Recently, Character.AI launched its premium service c.ai+, which offers a similar set of perks to ChatGPT Plus, such as faster response times, access during usage peaks, and early access to new features.

It also announced a strategic partnership with Google Cloud to build and train its artificial intelligence models. The deal will see the startup use Google Cloud's Tensor Processor Units to train and infer LLMs (Large Language Models) faster and more efficiently, the company said. We also look forward to seeing its further improvement.

02 Exclusive virtual circle of friends

What if you could choose from 10 million instead of just one AI chatbot?

From Vladimir Putin to Einstein, from Elon Musk to Mario, whether virtual or real, you can chat with any character on the Character.AI platform. You can even build your own chatbot for private one-on-one conversations or for other people to chat with.

Since the breakthrough success of ChatGPT, many challengers have tried to claim its crown, and Character.AI is no exception, and its playful take on generative AI is helping it stand out.

Character.AI is easy to use: You just create a free account with email or social information like Google, and start chatting with the bots in its database.

A wide variety of chatbots are available on the Character.AI homepage, and the character categories at the top of the page include:

AI Assistant: Fitness Coach, Fiction Writing Assistant, Character Creation Assistant, Programming Assistant

Famous People: Actors, Music Artists, Writers, Politicians, Historical Figures

Fictional Characters: Characters from movies, TV shows, books, video games, manga, and anime

Image Generation : Characters that can AI generate images for different purposes

Language Learning: Characters designed to help users learn a specific language

If you want to create your own bot, just click "Create" and follow the instructions. Users can fully customize the characters to make them more suitable for their own preferences and needs. It should be noted that, just as the blunt red warning above the Character.AI chat interface "everything the character says is fictitious", you should realize that chatbots often make mistakes.

In addition to creating roles, you can also create chat rooms and invite multiple roles or other users to join group chats. This mode can not only increase the fun and variety of conversations, but also allow users to make more friends. Group chat mode is a unique mode of Character.AI, users can see the interaction and collision between different characters, and may even produce unexpected "sparks".

Different from other chatbot websites on the market, Character.AI also provides an original community, where users can share their created characters or chat records, and get feedback and comments from other users. Users can also learn from other users' creative skills and experience to improve their chatting skills and creativity.

All in all, Character.AI is a versatile chatbot platform, and with a growing user community and a chat scoring system that allows users to rate characters' replies, the promise of this platform cannot be underestimated.

03 Behind the 2 billion pieces of information, is the traffic blowout?

It is not difficult to see that the characteristic of Character.AI is that it allows users to have creative and emotional dialogues with various characters. Increasing DAU (number of daily active users) and developing UGC (user-generated content) are its two main directions.

DAU is one of the important indicators to measure whether a product is popular and valuable. Improving DAU can reflect the user stickiness and satisfaction of AI chatbots, and can also increase user trust and loyalty. Character.AI provides a wide range of application scenarios, such as social skills practice, language learning, interview preparation, story interaction, etc., which allows users to have endless learning and entertainment opportunities.

According to the company, since the beta launch last September, users have sent more than 2 billion messages and spend an average of two hours a day on the site. The founders believe there is endless potential for conversational AI, and that people around the world can find meaning in using them, whether it's increasing productivity, relaxing, or finding a supportive friend.

UGC refers to the content created or shared by users independently. Character.AI allows users to create personalized AI dialogue robots. The development of UGC can greatly enrich the content of AI chatbots, broaden the depth and breadth of dialogue, and increase user participation and sense of belonging. The platform has accumulated tens of millions of chatbots, which are classified according to types, ranging from Internet celebrity bloggers to film and television animation characters, and most of them are created by users with love.

Are Virtual Companions the New Boom for Conversational Robots?

Foreign Replika AI is not limited to text dialogue, but also allows users to create virtual people by pinching faces, changing clothes, and selecting voices. Some users even announce that they are marrying the perfect virtual partner on the platform, because they communicate with each other like long-distance couples. ,Send photos.

The domestic virtual lover product Glow was once a smash hit. Although it is currently off the shelves due to the development of version 2.0, it can be seen from the sharing and comments on major platforms that its fans are very sticky.

In the fast-paced modern society and high-pressure life, people's loneliness is common. However, the AI companion has its inherent limitations. It is virtual, not physical, and it is easy for users to have hallucinations when the virtual and real are intertwined. Character.AI has also marked this problem on the top of each chat box, which may affect some immersive experience, but this measure is necessary in a sense.

Character.AI has also set a strict restriction mechanism, which will automatically filter any NSFW (content not suitable for browsing in the working environment). This is incredible for many AI companion robots of the same type. Character.AI also does not provide an API, although it is open source, users cannot download it for local use.

This can be said to be its advantage, but also its disadvantage, or even its characteristic.

04 In the future, there is no need to be omnipotent

The DAU indicator is not the only criterion for measuring the success of a product, but for Character.AI, which chooses To C as its current track and user orientation as its product strategy, it is the focus of attention and hard work.

Character.AI is still in the development stage. Although it has over 10 million monthly active users, it is still cautiously exploring the business model. The founders knew that they could not compete with big companies in terms of functionality, nor did they expect to create a chatbot that most people would like. Character means text, character and role, aiming to create a unique character through text.

As for whether the future will only stop at "words shaping virtual friends", I believe that Character.AI will have its own thinking based on the needs of users.

After obtaining more financing, Character.AI will focus on deploying AI's memory ability, and at the same time use more computing power to help users find their favorite chat methods and content, rather than creating an omnipotent official dialogue robot.

The Internet celebrity pet video BGM Hakimi became popular, proving that people’s emotional connection does not lie in how smart the provider is. Even if there is no language ability, companionship and affection still exist.

Of course, this is just the starting point, and we expect more AI+ applications to be implemented. Do androids dream of electric sheep? Hope it will.

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