Adobe does not make many acquisitions in India. In November 2023 it made its first one in generative AI anywhere, buying a seven-year-old, Bengaluru-built avatar-video startup called Rephrase.ai for an undisclosed sum. Seventeen months later, the Indian company whose engineers built that technology was under liquidation.
Both things are true, and neither cancels the other out. Rephrase.ai’s three founders and most of its roughly 45-person team moved to Adobe to keep building the same product inside Firefly. What they left behind was an Indian private limited company, Rephrase Technologies Private Limited, that had no more business to run once its technology, customers and staff had migrated to its American parent’s new owner. That gap — between a startup “getting acquired” in the press and what happens to the legal shell it leaves behind in India — is the real story here, and it says as much about how Indian-founded, US-parented startups exit as it does about Rephrase itself.
Quick facts
| Company | Rephrase.ai (Rephrase Technologies Private Limited, India; parent Rephrase Technology Corp, US) |
| Founded | 2018, Bengaluru (insightiitb.org, IIT Bombay Insight) |
| Founder(s) | Ashray Malhotra (CEO), Nisheeth Lahoti, Shivam Mangla — all IIT graduates, class of 2015 |
| Businesses | AI-generated “digital human” video: text-to-video avatars, voice cloning and personalisation at scale for enterprise sales and marketing (Rephrase Studio, API) |
| Latest FY revenue | ₹19.0 crore ($2.0 million) in FY24, down about 19.0% year-on-year (Tofler / TheCompanyCheck, MCA filing) |
| Latest FY profit/loss | Near-breakeven in FY24: net profit margin of 0.7% on revenue (Tofler, MCA filing); absolute profit/loss not disclosed |
| Listed | Private. Acquired by Adobe on 22 November 2023 for an undisclosed sum (Business Today; AZB & Partners) |
| Market value / last valuation | Not disclosed — neither the September 2022 Series A nor the Adobe deal carried a public price tag |
| Key shareholders / CEO | Backers included Lightspeed India, AV8 Ventures, Red Ventures, Silver Lake and 8VC; CEO Ashray Malhotra now leads the team inside Adobe |
What they do
Rephrase.ai built software that turns a script into a video of a person speaking it — without a camera, a studio or, in many cases, the person being filmed again. A brand or salesperson typed text, picked a digital avatar and a voice, and the platform generated a lip-synced, personalised video in minutes rather than the weeks a live shoot would take. Its customers were enterprises, not consumers: sales teams sending prospects a personalised pitch, marketers producing thousands of localised versions of one ad, and e-commerce catalogues that needed a presenter video for every product. Clients that have publicly used the product include Amazon, Cadbury-maker Mondelez, Xiaomi, Castrol, Bajaj Finserv and Comcast NBCUniversal.
The origin
Ashray Malhotra and Nisheeth Lahoti, both IIT Bombay graduates, had already tried building a company once. Their first venture, SoundRex, used machine learning to cut latency in audio transmission; it did not become the business they wanted. Lahoti kept returning to a bigger idea: an engine that could take a script as input and produce a finished film as output, without anyone shooting a single frame. Malhotra, who had run the short-film club at IIT Bombay and later worked at Goldman Sachs and MIT Media Lab, had seen first-hand how much time, money and coordination even a short film demanded — the lighting, the reshoots, the actors’ schedules. Shivam Mangla, an IIT Roorkee graduate who had worked at Facebook, joined as the third co-founder. Together, in 2018, they set out to build that engine in Bengaluru.
The struggle years
The Hollywood-scale ambition did not survive contact with reality. Early prototypes needed roughly eight hours of footage of a person to convincingly predict how their face would move for any new sentence — an amount of data no real customer could supply, and a technical wall the founders spent about 18 months working to bring down before they had something enterprises could actually use. The team took the idea into the Techstars Bangalore accelerator in 2019 with a prototype built for video dubbing — matching a speaker’s lips to a translated audio track — and it was inside that programme that they made the harder call: dubbing alone was not a business. They pivoted from dubbing to full text-to-video generation, and from a “Hollywood engine” to something narrower and more sellable — personalised sales and marketing video for businesses, “short-term and monetizable” rather than a moonshot, in the founders’ own description of the shift. That reset is why the company’s first institutional cheque, a $100,000 pre-seed round, only closed in February 2019, a year after the founders had started building.
The turning point
The moment Rephrase.ai stopped being a promising demo and became infrastructure for a mainstream Indian ad campaign was Cadbury Celebrations’ #NotJustACadburyAd, built with agencies Ogilvy and Wavemaker and first run around Diwali 2020, then expanded in 2021. The brief was almost absurd: let any small shopkeeper insert their own store’s name into a Shah Rukh Khan advertisement, generated on demand, at national scale. Rephrase.ai built five digital avatars of Khan, one per store category, and the lip-sync and voice-cloning pipeline that let a shopkeeper’s name be dropped into Khan’s spoken line in real time. By WPP and Ogilvy’s own case study, the campaign produced roughly 130,000 personalised ad versions across around 2,000 stores and drew about 94 million views on YouTube and Facebook; a separate industry account puts the count nearer 139,000 ad versions and 105,000 site visitors over ten days, with output scaling from 1,000 to 20,000 personalised videos a day within two weeks. On the other side of that event: an 18-month-old company that had raised a $1.5 million seed round now had a campaign that went on to win India’s first Titanium Lion at Cannes in 2022, and YouTube made a one-off exception to its policy against synthetic-media advertising to run the videos at all. Fourteen months after the 2021 run of the campaign, Rephrase.ai closed a $10.6 million Series A.
The money behind it
Rephrase.ai’s total disclosed funding sits in a narrow, mostly-agreed range: Crunchbase and Inc42 both put it at about $12.2 million across four priced rounds; CB Insights counts $13.92 million if accelerator cheques and the Adobe deal itself are folded into the tally as “rounds.” No round carried a disclosed valuation.
- Pre-seed — $100,000 (3 February 2019). First institutional capital, raised after the pivot away from the Hollywood-engine idea (Crunchbase).
- Seed — $1.5 million (24 September 2020), led by Lightspeed Venture Partners and AV8 Ventures. Capital was earmarked to scale the video-personalisation platform, build out the Bengaluru engineering team and start a North American commercial push (YourStory, TechCrunch).
- Series A — $10.6 million (15 September 2022), led by Red Ventures, with Silver Lake and 8VC participating. By the founders’ own account the team grew from 12 to 35 people in the year around this round; the round funded further North American expansion and hiring across engineering, product and sales (PR Newswire).
- Comcast NBCUniversal LIFT Labs — strategic accelerator backing (June 2023). A media-industry strategic partner rather than a venture round, and one of the last capital events before the Adobe acquisition (CB Insights).
Two changes stand out in what each backer brought: Lightspeed and AV8 funded the shift from a research prototype to a product businesses would pay for, and Red Ventures — itself a performance-marketing company — pulled Rephrase.ai’s growth story toward large-brand marketing use cases rather than pure sales enablement, the segment the Series A press release leaned on hardest.
How it makes money
Rephrase.ai sold video generation as enterprise software, not as a consumer app, which shaped where its margin could come from and where its costs sat.
- Money in: platform subscriptions and usage-based fees for Rephrase Studio (self-serve avatar video creation), plus bespoke, higher-ticket engagements for large brand campaigns such as #NotJustACadburyAd, and API licensing for partners who wanted to embed video generation into their own product (company case studies; Forbes).
- Costs out: the heaviest cost was compute for training and running its lip-sync and voice-cloning models at scale — the same constraint that forced the founders to spend 18 months cutting the footage needed per avatar from roughly eight hours down to about ten minutes, since more efficient models directly lowered the cost of onboarding a new presenter (TechCrunch).
- Where the margin sits: self-serve, template-driven video for existing customers was the more scalable, higher-margin line once an avatar existed; one-off flagship campaigns like the Cadbury work were lower-margin but functioned as marketing for the platform itself, generating far more press and case-study value than their direct fees.
- What people got wrong: the company was frequently described in coverage as a “deepfake” tool; its own public materials stressed that avatars required the presenter’s consent and that access was business-only, precisely to separate its product from the unauthorised face-swap tools the word usually describes (TechCrunch).
The numbers
Rephrase.ai was privately held throughout its life and disclosed no investor financials publicly; the figures below come from its Indian entity’s regulatory (MCA) filings as aggregated by Tofler and TheCompanyCheck, and from Inc42’s FY25 tracker. Unit is ₹ crore unless noted.
| Fiscal year | Revenue (₹ crore) | YoY change | Profit/loss |
|---|---|---|---|
| FY23 (year to Mar 2023) | ≈23.4 (implied) | +239.2% over FY22 (Tofler/TheCompanyCheck) | Not disclosed |
| FY24 (year to Mar 2024) | 19.0 | -19.0% (Tofler/TheCompanyCheck, MCA filing) | Near-breakeven; net margin 0.7% (Tofler) |
| FY25 (year to Mar 2025) | 0.01 (₹1.0 lakh) | -99.9% (Inc42 FY25 Financial Tracker) | Not disclosed |
- FY23 revenue growth of 239.2% and profit growth of 81.74% were both reported year-on-year off the prior filing (TheCompanyCheck, MCA data) — the FY23 absolute revenue figure above is calculated by reversing the disclosed FY24 decline of 19.0%, since the company did not itself publish the FY23 rupee amount.
- FY24 revenue of ₹19.0 crore is the last full year the entity operated as an independent business before the November 2023 Adobe deal closed partway through it (Tofler; TheCompanyCheck).
- FY25 revenue of ₹1.0 lakh reflects an entity with almost no remaining operations: by then its technology, customers and most staff had moved to Adobe, and the Indian company itself was heading toward liquidation (Inc42).
- Granular FY21 and FY22 absolute rupee figures sit behind paid MCA-aggregator subscriptions and could not be independently verified this session; they are omitted rather than estimated.
Where the money comes from
Rephrase.ai never disclosed a formal revenue split by segment or geography, but its public case studies and funding narrative point to a business built on three overlapping lines, tilted more toward large-brand marketing spend than the “sales enablement” pitch the company led with in its early fundraising.
- Enterprise sales video — personalised outbound video pitches sold to B2B sales teams, the original wedge product and the use case in the Series A announcement (PR Newswire).
- Brand marketing campaigns — large, one-off engagements such as #NotJustACadburyAd (Mondelez), Xiaomi and Castrol activations; these produced outsized press value relative to their likely share of revenue (company case studies).
- Catalogue and e-commerce video — bulk, API-driven video generation for product listings, exemplified by Amazon’s reported use of the platform to generate 1,300 product videos in 1.5 hours (Pulse2).
- Geography: engineering and delivery stayed anchored in Bengaluru throughout the company’s life (multiple sources, including TechCrunch and YourStory), while commercial focus shifted toward North America after the 2022 Series A — Inc42’s company profile lists San Francisco as headquarters by the time of the Adobe deal, a shift the Series A press release had explicitly funded.
The surprise is less about geography than about size: a company whose engineering headcount peaked at roughly 45 people (Verdict) was, for a few weeks in 2021, running the back end of one of India’s most-watched Diwali ad campaigns — evidence that Rephrase.ai’s revenue depended less on volume of small customers than on a handful of very large, campaign-shaped contracts.
The risks
- Revenue concentration in lumpy, campaign-shaped deals. A business model weighted toward a small number of flagship brand campaigns is exposed to the loss of any one client or the non-renewal of a single high-profile engagement; the swing from +239.2% revenue growth in FY23 to -19.0% in FY24 is consistent with that kind of lumpiness rather than steady subscription growth (Tofler/TheCompanyCheck MCA data).
- Trust and regulatory risk around synthetic media. Rephrase.ai operated in the same technical space as deepfake tools, and had to build in presenter-consent controls and restrict access to verified businesses specifically to manage that association; YouTube’s platform policy against synthetic-media advertising required a one-off exception even for a consent-based, brand-approved campaign (TechCrunch; MediaBrief).
- Crowding in AI avatar video. By the time of the Adobe deal, Rephrase.ai competed directly with well-funded rivals including Synthesia, HeyGen, DeepBrain AI and Hour One, several of which had scaled avatar libraries and language coverage faster than Rephrase’s roughly 45-person team could match (CB Insights; Tracxn).
The takeaway
The lesson in Rephrase.ai is not really about video generation. It is about what “acquired” quietly leaves out. Adobe got the technology, the product roadmap and almost all of the people; the founders and engineers who built #NotJustACadburyAd are, by every public account, still building the same kind of thing inside a much larger company today. But the Indian legal entity that had employed them, held their intellectual property on paper and filed their tax returns had no further reason to exist once that transfer was done — and, per its own regulatory record, it was placed under liquidation by April 2025. For founders and employees at India-built, US-parented startups, a headline acquisition and a clean ending for the Indian company are two separate events, and only one of them is guaranteed by the deal itself.
Frequently asked questions
What did Rephrase.ai actually make?
An AI platform that generated video of a “digital human” avatar speaking a script the user typed, using lip-sync and voice-cloning models, sold mainly to enterprises for sales outreach, marketing campaigns and product-catalogue video.
Who founded Rephrase.ai, and when?
Ashray Malhotra, Nisheeth Lahoti and Shivam Mangla, three IIT graduates, founded the company in Bengaluru in 2018, after an earlier venture between two of them, SoundRex, did not work out (insightiitb.org).
When did Adobe acquire Rephrase.ai, and for how much?
Adobe acquired Rephrase.ai on 22 November 2023, its first acquisition in generative AI and video tooling and the first-ever acquisition of an Indian startup by Adobe. The purchase price was not disclosed (Business Today; AZB & Partners).
How much funding did Rephrase.ai raise before being acquired?
Around $12.2 million across a pre-seed, seed and Series A round, per Crunchbase and Inc42; CB Insights’ broader count, which includes accelerator backing and the acquisition itself, puts total disclosed capital events at $13.92 million. No round’s valuation was made public.
What happened to Rephrase.ai’s India entity after the acquisition?
Rephrase Technologies Private Limited, the Indian operating company, continued filing accounts through FY24 (revenue ₹19.0 crore) before revenue collapsed to about ₹1.0 lakh in FY25 as operations wound down; MCA-linked filings tracked by Tofler and TheCompanyCheck show the company under liquidation, with a resolution professional appointed on 28 April 2025.
Sources
Figures are as of September 2026. Currency converted at $1 ≈ ₹96.0 as of 18 September 2026 (Trading Economics).
- Business Today, “Adobe ventures into AI video space with Rephrase.ai acquisition: Report,” November 2023
- AZB & Partners, “Adobe on its acquisition of ‘Rephrase.ai’,” November 2023
- Decrypt, “Indian AI Video Startup Rephrase.ai Announces Acquisition by Adobe,” November 2023
- Verdict, “Adobe acquires Indian generative AI startup Rephrase.ai,” November 2023
- PR Newswire, “Rephrase.ai Secures $10.6 Million in Series A Funding Led by Red Ventures,” September 2022
- TechCrunch, “Synthetic media startup Rephrase.ai raises $1.5M,” September 2020
- YourStory, “[Funding alert] Rephrase.ai raises $1.5M seed round led by Lightspeed Ventures,” September 2020
- Crunchbase, Rephrase.ai funding round profiles (pre-seed, seed, Series A), accessed September 2026
- Inc42, “Rephrase.ai — Funding, Revenue & Investors,” accessed September 2026
- Inc42, “FY25 Financial Tracker: Tracking The Financial Performance Of Indian Startups,” 2026
- CB Insights, “Rephrase.ai — Financials,” accessed September 2026
- Tofler, “Rephrase Technologies Private Limited,” accessed September 2026
- TheCompanyCheck, “Rephrase Technologies Private Limited — FY 2025 Insights,” accessed September 2026
- Tracxn, “Rephrase.ai — Company Profile,” accessed September 2026
- Forbes, “Rephrase.AI Aims To Democratise High-Quality Video Creation,” November 2022
- Pulse2, “Rephrase.ai: Making Videos Easier To Generate In Over A $10 Billion Market,” 2022
- Insight (IIT Bombay), “Rephrase.AI: Reinventing Video Creation,” accessed September 2026
- MediaBrief, “Rephrase AI’s ‘NotJustACadburyAd’ featuring Shahrukh Khan wins Titanium Lion,” 2022
- WPP, “Ogilvy and Wavemaker: #NotJustACadburyAd and Shah Rukh Khan-My-Ad,” case study, accessed September 2026
- Arthnova, “How Cadbury Used AI to Make Shah Rukh Khan Every Store’s Ambassador,” accessed September 2026
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