Pocket FM, the audio storytelling platform founded in 2018, reported that its annualized revenue run rate has doubled to $500 million after a year of heavy investment in generative AI for content production. Co-founder and CEO Rohan Nayak said AI now powers 93% of the overall catalog and is used to produce 99% of new content.
AI tools and production economics
Nayak said the company focused on building AI tools around the creative process rather than letting models generate content autonomously. He added that the technology has made content production about 80x cheaper, and that 100 hours of content that previously took about a year to produce can now be created in a day.
Vasu Sharma, Pocket FM’s head of AI and a former Meta and Tesla scientist, said the startup has trained its own models for tasks such as creative writing and text-to-speech using years of production data and listener engagement signals. Despite the shift, Nayak said human creators still provide ideas and storytelling direction.
Scale, revenue mix and international growth
The company said its more than 550,000 creators now produce roughly 2.5 million hours of AI-powered content per year. Two years ago, the platform’s entire catalog totaled about 100,000 hours; today Pocket FM says it has built a library of more than 770,000 audio series and counts over 250 million listeners across more than 20 countries.
Nayak reported that the platform’s 12-month revenue retention rate rose to 76% from 44% two years earlier, and attributed the improvement in part to a larger variety of titles. Pocket FM said 96 titles on the platform have each generated more than $1 million in revenue, including 13 that have crossed $10 million.
The startup said about $85 million of the annualized revenue comes from advertising and roughly $415 million from users paying to unlock individual episodes. The U.S. is its largest market, accounting for about 70% of the annualized run rate and growing approximately 70% over the past year.
Pocket Entertainment, the parent company, has begun applying the AI-driven model beyond audio. Its three-month-old Pocket Saga microdrama app, available only in the U.S., reached an annualized revenue run rate of about $15 million and uses entirely AI-produced content. The company said it plans to enter at least two more entertainment formats over the next five years and aims to license stories for books, TV and film.
Nayak acknowledged talks with investors about raising $100–$120 million at a reported valuation near $2 billion but said the company is under no immediate pressure to raise capital and declined to specify amounts or valuation. Pocket Entertainment said it is profitable and generating positive cash flow on an adjusted basis but declined to disclose profit, cash flow or margins. Nayak said the company does not plan to go public in the next 24 months.
Original source: TechCrunch AI