Dealmaker Q&A: Panopto’s Jason Beem on Acquiring Elai

Panopto, an AI-powered video creation and management solutions company, acquired Elai, an AI text-to-video platform, in a bid to address some of the challenges posed to content creators and online learners. Panopto’s CEO, Jason Beem, spoke to Middle Market Growth about the role Elai will play in their content creation ecosystem, the new AI applications Panopto is developing and more.

MMG: What initially attracted Panopto to Elai?

Jason Beem: We’ve been in the AI space for I think five-plus years with parts of our application, even before it was called AI. But we’ve long been looking at various AI features for business content creation. We have a ton of content in our platform, both on the education side and the corporate side, but how do we make it easier for content creators or the people driving learning within a business or university to create that content? So, we spent a ton of time looking at AI technologies and looked at around 20 AI content creation companies and Elai rose to the top of this list—particularly because their technology of AI-generated avatars, voices and interactivity aligned with our goals. The integration of Eli’s advanced AI features adds a substantial value to our offering and enhances the customer experience for our existing and future customers.

MMG: Can you share some points from your strategy for integrating Elai into your operations?

JB: I have an extensive background in M&A, and I’ve actually run over 20 acquisitions and integrations in my past life. One of the most important things is to look at it from two aspects. There is the company or people integration, and then there’s the other side, which is the actual technology integration into your platform. They’re both just as important as the other. First, on the people side, the teams from both companies already work together and are already getting integrated. Elai’s team participated in the all-hands meeting essentially the day after we acquired them. And that cultural integration is very important to ensure that we have a stable working environment and a stable company.

One of the most important things is to look at (M&A) from two aspects. There is the company or people integration, and then there’s the other side, which is the actual technology integration into your platform.

On the technical side, we are first focused on integrating a single sign-on giving our customers seamless access to the application so there’s not a clunky login process. We think we’ll have that done and rolled out to our customers within the next six to eight weeks so they can immediately take advantage of the technology. The second phase of that is really the full platform integration, and that’s a little more complex. It takes a lot more time to integrate all Elai’s features into the platform so that it looks and feels like one application. That’s going to take about six months to to get that that completed. And again, I’ve done a lot of these in the past and that is actually very fast for a technical integration. We’re putting a ton of resources toward driving this forward as fast as we can.

MMG: How are you planning to pursue growth, and how do those strategies reflect the state of video creation innovation today?

JB: The strategy is to leverage the leading position in the video platform market and strengthen it with Elai’s AI capabilities. The combined platform creates a unique offering particularly advantageous to both higher education and corporate. This combination of the two companies is not something that you see out in the market right now. So, we are going to be the first AI-generated video company that also has the platform where you can store those videos, improve those videos and then put them in a format and platform that makes them easy to consume. We’re the first to market on this.

MMG: What are some of the challenges that you’re facing in the AI-powered tech and solutions space, and how are you planning to drive growth despite those?

JB: Obviously, AI is hot right now and the pace of innovation is rapid. There are a lot of great companies out there experimenting with this. Most of these companies are very small. They’re the startups. They don’t have a lot of funding. Very few of them have a robust infrastructure to be able to kind of continue to innovate at the pace that the market demands. This is where we stand out from most of those competitors. Panopto is in a very, very good financial position. We’re very profitable. We’ve been around a long time. We have the money and the resources to spend on innovation and development where others cannot and that makes it a game changer for us, to allow us to continue to push money into this area. I don’t think others can do that.

MMG: Are there new AI applications you’re looking at building and implementing in the near future?

JB: There are a number of things we’re very interested in experimenting with right now. One of the things that we’re looking at: Because we’ve been in the video space for so long, we see a change of behavior with people that are learning, as the current generation is going through university, getting their degrees, then moving off into the into the workforce. We see that this generation likes shorter videos. When they go into their 60-minute lecture at university, they zone out after 15, 20 minutes. So, what we’re thinking would be very valuable to this generation, and even older generations like me, is being able to take a 60-minute lecture or a 60-minute corporate training video, break it down into themes, and have the AI create shorter videos—call it a TikTok video, or whatever you want to call it. So, this is an area we’re focused on right now, to automatically create those small snippets and themed videos that can actually drive value for learners.

Another thing we are experimenting with in development, and even looking outside to find via acquisition, is creating more advanced interactivity. That means AI-generated quizzes, flashcards, notes, things like that, so that the learner can watch the video then go back and review before they take the test, so they retain that information.

The final area I’ll mention that we’re looking into right now is AI recommendations, where a university student or a learner within a corporation, as they’re training and watching videos and taking quizzes, they can have AI look at how they’re testing. And where they’re not testing as well, AI can automatically recommend additional content on the same subject that is already available within that corporation or within that university, and start feeding the learner additional content so they can improve their knowledge retention.

This interview has been edited and condensed for clarity.

Hilary Collins is ACG’s Associate Editor.

Middle Market Growth is produced by the Association for Corporate Growth. To learn more about the organization and how to become a member, visit www.acg.org.