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While global demand for K-content has grown with the expansion of OTT (online video streaming services), conditions on the production floor remain challenging. As competition among OTT platforms intensifies, production costs per drama have surged over the past few years, yet these cost increases have not translated into improved profits for production companies and post-production vendors. In particular, in the visual effects (VFX) industry, profitability has declined despite rising labor rates and production burdens, leading to a series of cases where even major firms are struggling financially.
In this context, top-tier personnel from the domestic VFX industry have launched their own AI video production company, stating that "there is no future as things stand." The company is Derman T Story, founded by Jeong Hwang-su (CEO), who led the special effects for films such as 'Train to Busan,' 'Peninsula,' and 'Jeong-i.' The company recently secured seed investment from Series Ventures, an accelerator specializing in the southeastern region.
The first thing Series Ventures focused on was the "team's track record." Jeong (CEO) has served as Vice President of the VFX Business Division at NEW, a film distribution and exhibition company, and as Head of the VFX Supervisor Department at Digital Idea, among other roles. He received the Special Effects Award at the 49th Sitges International Film Festival for 'Train to Busan.' Nayl Hwan, Chief Content Officer (CCO), also oversaw concept art for Netflix's 'Hellbound' and 'Jeong-i,' as well as Disney+'s 'Moving.' Kim Hyung-cheol, Venture Investment Division Head at Series Ventures, said, "The CEO and team members are top-tier industry personnel who have handled special effects for major films," adding, "We highly valued the fact that the most sought-after top-tier talent from the field came together."
Derman T Story's core technology is its self-developed AI video generation engine, 'theROAD.' When a scenario is input, the AI extracts characters, props, backgrounds, lighting, and camera angles from the script to create images, which are then connected into video sequences and completed after expert review. The company explains that this allows VFX work previously performed by dozens of personnel over several months to be handled by a small team.
Another differentiator highlighted by Series Ventures is "Korean style" and "copyright." Kim said, "Even if you try to create a video of someone wearing hanbok walking through a Korean alley, general-purpose AI has limitations, such as expressing hanbok in a Chinese style," explaining, "This team trains its model based on the rights to dozens of works they have directly produced, enabling them to create videos that properly implement Korean elements."
Furthermore, because they use their own intellectual property (IP) for fine-tuning, they are relatively free from copyright issues that could become obstacles in commercial video production.
Solving "consistency," a chronic challenge in long-form video, is also cited as a strength. While short clips can be made convincingly with general-purpose AI, consistency breaks down as videos get longer, with character faces or backgrounds changing from scene to scene. Kim said, "The founding team approaches the project with the concept of creating an 'AI film director' rather than a general-purpose AI video generator," noting, "During investment review, the CEO showed us a long-form video produced using their in-house tools; it was so natural that it could have been used in an actual film without any awkwardness."
Along with this investment, Derman T Story was selected for the Ministry of SMEs and Startups' TIPS program on Series Ventures' recommendation, securing 800 million won in R&D funding. The company plans to use these funds to expand its AI video production process, validated in short-form content, into long-form formats such as films and dramas.
The company has also established an industry-academia collaboration with Dongseo University, which specializes in AI video and design. It plans to accelerate technological advancement by pursuing joint technology development and talent recruitment simultaneously. Next year, the company aims to launch the official B2B (business-to-business) service for 'theROAD 2.0,' targeting the release of a subscription-based B2C (business-to-consumer) service in 2028.
Kim said, "Derman T Story is a team that solves copyright and quality problems unsolved by general-purpose AI, based on production know-how accumulated over 25 years and its own AI technology," adding, "It has great potential to establish Korean standards in the long-form AI video market."
[MoneyToday startup media platform Unicorn Factory]
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