Google Pays $100M for AI Avatar Startup Alter

Google has reportedly acquired artificial intelligence (AI) avatar startup Alter — which was formerly known as Facemoji — for $100 million.

The purchase took place two months ago, though it has not been publicly disclosed by either company, TechCrunch reported Thursday (Oct. 27), citing an unnamed source.

After starting as Facemoji and helping developers put avatars into games and apps — and getting $3 million in seed funding — the company rebranded as Alter and now helps creators and brands develop avatars, according to the report.

Google plans to add Alter’s capabilities to its own content offering and give it more tools in its competition with TikTok, per the report.

A Google spokesperson confirmed in an email to PYMNTS that Google has acquired Alter.

According to the company’s LinkedIn page: “Alter is an open source, cross-platform [software development kit (SDK)] consisting of a real-time 3D avatar system and motion capture built from scratch for web3 interoperability and the open metaverse. With Alter, developers can easily pipe avatars into their app, game or website.”

As PYMNTS reported in June, Meta Platforms is using avatars as a way to link user identity across its platforms like Facebook and Instagram and other services.

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In fact, the company debuted a digital clothing store to let users buy designer outfits for their avatars. Users can set up the avatars to play games, take exercise classes, take conference calls and perform other functions.

As PYMNTS reported in August, in the metaverse, an avatar is a virtual representation of the user similar to those used in games.

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Platforms aim to make the avatars either very realistic or wishfully realistic virtual representations that allow users to interact and socialize.