Pow! Bam! Biff! Special effects studio Monsters Aliens Robots Zombies raises $6.5 million

Monsters Aliens Robots Zombies might sound like your worst nightmare, but it’s actually the name of a technology and visual effects (VFX) startup that’s using artificial intelligence (AI) to help speed up and enhance production.

Monsters Aliens Robots Zombies’ (MARZ) slightly eerie name hasn’t put off investors; the fast-growing startup just raised $6.5 million CAD in Series A funding. Round13 Capital led with participation from Rhino Ventures and Harlo Equity Partners, and digital transformation company Torinit. John Cassaday, former founding president and CEO of Corus Entertainment, and Jake Cassaday, COO at Playmaker, came in as strategic angel investors.

“The entire industry is facing a massive capacity shortage due to the explosion of content, which we think is going to worsen over time.”

The round closed in late October.

MARZ plans to use the fresh funds to build out its core VFX services business and to accelerate the research and development of its AI For VFX technology solutions. The startup founded its own AI department to deal with a growing problem in television production—a shortage of VFX capacity caused by a corresponding growth in on-demand entertainment.

MARZ co-founder and co-president Jonathan Bronfman said, to date, the company’s AI department has been built on the back of the VFX business along with his own investment in the company. “So the raise will go to repatriating my investment to date as well as fueling the rapid growth of our business,” Bronfman said.

The round marks Rhino Ventures’ first in Toronto since it launched its latest fund and said that it would move beyond Western Canada for investments.

Matt Panousis, MARZ co-founder and COO, said what attracted Round13 and Rhino to the startup is the fact that it has a strong, core business, but layered on top is AI allowing MARZ to expand into new areas. “Quite frankly, not all VCs share that view, but they did, which is why I think we connected quite well with them,” Panousis said.

Of course, it didn’t hurt that MARZ is an Emmy-nominated startup that produces VFX for major shows for Netflix, Marvel, and HBO, among others, and includes WandaVision and the Umbrella Academy series in its portfolio.

Brahm Klar, partner at Round13 Capital, will join MARZ’s board. “By partnering with MARZ, alongside some of Canada’s most successful investors, we can work closely with the team to build on the company’s extraordinary success so far,” Klar said.

In beta since the first quarter of 2021, MARZ’s first AI for VFX solution has been used on 17 Hollywood productions to date, with that number expected to double in 2022.
Panousis said television struggles with time and budgets. He noted in the last year, even as quality expectations for VFX rose dramatically, time and budgets aren’t growing at a corresponding rate.

MARZ’s AI generates film frames faster than artists can by hand, and lowers the cost of creating feature film-level, quality VFX.

The co-founders said the VFX capacity shortage is due to streaming wars, the corresponding explosion of on-demand content, and the ever-increasing importance of VFX in driving subscriber growth.

“The entire industry is facing a massive capacity shortage due to the explosion of content, which we think is going to worsen over time,” Panousis said. “That’s what led us down the path of what’s an exponential technology that not only solves for quality but for time, cost, and capacity. That led us to AI.”

Bronfman got together with Lon Molnar—MARZ’s other co-founder and co-president—in late 2016. By that time, Molnar was well known in the industry, having worked on several dozen feature films and television shows. “We bootstrapped the company on the back of Lon’s reputation and ability to secure work,” Bronfman said.

By securing projects right away in early 2017, they were able to begin generating revenue. They started to hire artists, grow their infrastructure, and iron out work flows. By August 2018 they officially debuted, with Panousis, as MARZ and were able to “come out of the gates strong,” Bronfman recalled.

MARZ completed 13 projects in its first year, 21 in its second year, and 54 in its third year for clients such as Marvel, HBO, Netflix, and Apple TV. MARZ anticipates this rapid growth to continue after being named a primary vendor on a slate of significant future projects to be released later this year and in 2022.

MARZ has grown from 45 people in 2019 to 194 today, with plans to grow the team to 300 over the next year. Of its current employees, more than 25 percent are focused on R&D, machine learning, and AI.

The startup’s traditional VFX work has appeared in 68 TV projects in its first three years since inception – most notably, Marvel’s WandaVision, HBO’s Watchmen, Netflix’s The Umbrella Academy, and Apple TV’s Invasion.

MARZ received two Emmy Nominations in 2021: WandaVision (Outstanding Special Visual Effects In A Season Or A Movie); and The Umbrella Academy S2 (Outstanding Special Visual Effects In A Single Episode).

So what exactly does MARZ do? On WandaVision, it created the Vision character, “which is essentially Tony Stark’s AI—ironically,” Molnar laughed. Molnar said in that show they replaced significant portions of actor Paul Bettany’s head for a number of episodes, and also for one scene created a fully digital Vision rising up over a completely digital city.

But it’s not all fun and games, and superheroes.

Bronfman said it’s been incredibly difficult to develop the AI department within the company. One challenge in the VFX world is that resolution calls for 4K, which is four times the pixel count of HD. Panousis said it is “a very high bar for AI to perform well. If you look at most of academia, they’re very rarely focused on resolution, and this is something we have to solve.”

Fortunately, the traditional side of the business has grown rapidly, with its success fuelling the AI department, Bronfman said, adding: “As we brought our first product to market this year that department has not only started to generate its own revenue and profitability, but thrive as an independent arm within MARZ.”