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AI-related images generated by DALL·E 2. Art direction by Shane Burke and Mike Sullivan.
Oct. 17, 2022 6:17 PM PDT

Venture capitalists are shaking themselves out of a bear market slumber to chase deals in a pocket of artificial intelligence that’s spilled into the mainstream this year: AI that generates art, videos and writing.

Jasper AI, which last year started selling an AI-assisted writing tool, raised funding from Insight Partners at a $1.5 billion pre-investment valuation around June this year, according to two sources familiar with the talks. Startup valuations have fallen since then. But earlier this month hedge fund Coatue Management paid a higher price for new shares in the Austin, Tex.–based Jasper, which has rapidly increased its revenues using software developed by startup OpenAI.

Meanwhile, Descript, a startup that uses AI for video and audio editing and was founded by Groupon co-founder Andrew Mason, has been in talks with OpenAI CEO Sam Altman and other investors to raise a new round, according to people familiar with the discussions.

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