[SPONSORED] Magisto's robot Scorsese is now in 20 million pockets

By Sarah Lacy , written on February 27, 2014

From The News Desk

This post is part of our Hot Seat series and is sponsored by Magisto. Pando retained full editorial control over the piece.

It seems that Israel is finally starting to get the consumer Web.

In the late 1990s, Israel became a startup powerhouse fueled by its smarts in solving hard crypto-problems for enterprises. In the early Web 2.0 era, however, it mostly stumbled as now forgotten companies like MetaCafe became afterthoughts to American versions like YouTube.

But as the mobile world has created a raft of new, hard problems, Israeli entrepreneurship is showing signs of new life.

One up and comer is Magisto, a company that uses artificial intelligence to edit the massive trove of iPhone and Android photos and videos into something watchable. It's a very Israeli approach. The problem with video editing is not poorly conceived software, it's that few people posses the skills to turn raw footage into art, says founder Oren Boiman. Since we can't send the world to film school, let's create an artificial brain to master this esoteric human craft.

This month Magisto has announced a new European distribution deal with Deutsche Telecom, $2 million in strategic funding from, and new user numbers. Magisto has surpassed 20 million registered users and is adding two million per month, more than double since last September.

I tried out Magisto, quickly uploading some random footage on my phone of my son eating various things and picking a sentimental theme. It quickly produced a nice video. Not exactly Scorsese, but better than I would have done with an hour of time I don't have and iMovie. It was a nice touch that the music lowered as Eli said, "I want some more cashbrowns!" at McDonalds. It'll definitely make the grandparents' day.

For Magisto to achieve it's real goal of turning the world's crappy footage into art, its artificial brain will have to get even better. Boiman told us more about those plans and the early days of the company below in this sponsored Hot Seat Q&A.

Why'd you start this company?

When my first daughter was born I went out and bought my first camcorder and for the first time tried to capture an important moment. The raw footage was so boring and useless and disappointing. My wife and I just wanted to do something with this video to capture this life experience of a new family and share it but it was just so lame. We didn't want to make ourselves look ridiculous by sharing boring stuff.

I was a PHD student who knows something about software and my wife is an engineer, but after two weeks of slaving away we had an aha moment that editing raw footage is just a nightmare. There are millions and millions of life experiences captured and archived that will never been seen again.

It was so laborious and the tools were so primitive. I thought, this will never take off unless we can turn it into one big button people can push.

The promise is huge. There so much power in the storytelling in TV and film, and that's what I want when I watch my daughter's first moments of life.

I feel like Instagram and Vine and Snapchat have forced us to be good editors and share those moments because they limit what we can record and share. How is this different? 

When you look at footage from a camera, it's a replay of reality. That's not what you want to share. What you want to share is excitement and mood and the feeling of the reality. This is the art of editing. Instagram and Vine have done a great job at taking a limited segment but it's just 15 seconds.

We should be able to share compelling video longer than that. Video is a thousand times more powerful than the photos. It can make you laugh or cry but when it's not done well you are bored in a matter of seconds.

We've heard decades of promises of about artificial intelligence. Why is it the answer here?

Because editing is just so complicated. Video editing is an art; a very, very sophisticated art. It is very technical. There is a huge body of knowledge you need to do it right.

It is an art that evolved over the 20th century, to the point where you have Hollywood today. In movies everything happens exactly like the editor wanted. If they wanted the audience to laugh, every one laughs. If they want them to be frightened, they know how to make you frightened.

The user experience is just the entry point. That art is the key. Apple has done a great job with the UI, but after you spend a few hours you have a 90 second video and it's like, "That's it?" You aren't going to do it again.

The average person just doesn't have this skill. It's not going to happen.

Our software knows who the main character is, who the secondary character is, what feeling this video should capture.

How does it work?

It's almost as simple as a big button. You open the app can and choose whatever photos and videos you want to edit. You indicate a theme and every selection will chose a different algorithm to emphasize some aspect of the story. The soundtrack will lower at some point to heighten the dialog for instance. It lets you choose the soundtrack and the emotion or mood you want to set. You can control whether to make it longer or shorter.

If I select "romantic" does it give me the same sepia-toned romantic video that it will give someone else with their footage? How do you ensure these settings aren't overly derivative? 

It's not a template; it's an algorithm. It's a very general direction, not a heavy style. [Note: After playing with the product, I'm still concerned the styles will make multiple "romantic" videos look pretty similar even with different footage.]

How much money have you raised? 

We raised the seed round from Magma Venture Partners and just recently closed a $13 million round. That's a lot of money, and we raised it because we want to take this product to everyone. This is an everyone product. It's not just for teens and not just for young parents, it's for everyone. Not even 1 percent of what we capture is ever viewed again. People are capturing billions of life experiences everyday.

How do you make money? People aren't going to want ads in their home movies.

We have a freemium model. If you want to make longer movies over 1 minute with more 10 photos then you have to go premium. [You also have to upgrade to download the movies.]

How can you improve the product more?

We want the smart phone to have a less dumb camera. We want to start doing things for you. We want the smartphone to understand what you are trying to shoot and do things for you in the footage. To put a light on someone's face or focus on the main character. Make sure you get a good shot of the most important person. To tell you to move the camera a bit to get a perfect angle. We want to make the camera think for you like a professional filmmaker. That will help us create masterpieces compared to what we can do today. The world doesn't need more footage, but it needs better footage. [Some of this functionality is already announced and coming to Qualcomm customers via a recent partnership.]

Is Israel finally ready to produce big, stand alone, multi-billion dollar Web companies? 

In the last two years, we are starting to see a different culture and more internal debate about this. How could it be that all the very innovative companies here don't get very big? Waze managed to bridge this gap by having part of the company in Israel and part in the US, but the truth is most companies never get really big no matter where they are. In terms of numbers Israel creates a lot of startups, but nothing compared to the volume of startups that get created in the Valley. Essentially this is a numbers game. Most companies fail in the Valley because the Valley just creates the most startups.

But it is impossible to build Facebook and Twitter size companies in Israel. At some stage they need to put the focus on the US.

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