AI Content Production Platform That Spawned Trump Gaza Video Raises $5.5M In Funding Round

EXCLUSIVE: L.A.-based AI content production company Arcana Labs has unveiled $5.5M in funding and announced the launch of AI production studio, Arcana AI.

The round was led by SEMCAP AI, the AI financing arm of Pennsylvania-based growth equity platform SEMCAP, and co-CIOs Walter Buckley and Cyrus Vandrevala.

Launched in 2023, Arcana Labs is headed by Millennium Media President Jonathan Yunger, as a co-founder and CEO, and gathers a team of engineers and Hollywood filmmakers.

Its Arcana AI platform, which enables artists to generate images and video clips, recently hit the headlines after its tools were used to create a video depicting the Gaza Strip as an upmarket beach resort, which was then shared by President Donald Trump on his Truth Social platform.  

The Israeli creators condemned Trump’s use of the video without any context, saying they had created it in a satirical response to his suggestion that the U.S. should take control of the territory and turn it into the “Riviera of the Middle East,” while testing the Arcana AI tools.

Arcana Labs is positioning itself as a positive, disruptive force in Hollywood and the wider film business at a time of rising production costs, consolidation pressures, and creative talent bottlenecks.

“It’s time for Hollywood and Independents to dust off all that untapped IP and utilize Arcana technology to increase job opportunities and production velocity,” said Yunger, whose producer credits include blockbuster franchises such as Expendables, Hellboy, Hitman’s Bodyguard and Rambo.

“This is a time for artists and producers to be excited and to go make that full feature epic, that Superbowl commercial, that 20-minute cut scene in your video game.”

Arcana Labs is presenting Arcana AI as a “production company in a box,” developed with the needs of AI creators in mind, to offer a streamlined tool allowing users to switch between Arcana’s signature models and industry-leading models like DALL·E, Flux, and Stable Diffusion in a single workflow.

As well as images, it has advanced video capabilities allowing users to custom-train models, develop proprietary visual styles, and bring their creations to life with motion models from Kling, Runway, Minimax and Luma.

The platform is making inroads into Hollywood, where it has been used by producers, directors, visual effects studios and advertising agencies, and is currently in production with a SAG actors cast for a full AI created sci-fi epic as well as producing the first fully AI horror movie.  

SEMCAP co-founder and long-time technology investor Buckley said his company had connected with Arcana Labs through a docuseries about George Washington.

“In a very short period, leveraging Arcana, we were able to create realistic scenery and visually compelling content, more expeditiously and inexpensively than we had ever been able to do before. Prior to leveraging the platform, creating a historically accurate image took up 300 tries, and yielded very mediocre results,” he said.

The new funding will go toward the development of new technology and marketing efforts, as well as building out Arcana Productions, a creative arm of the company that assists production companies, brands and marketing organizations, as well as Arcana Academy, an educational initiative that will help teach new and seasoned filmmakers how to direct with AI.