Saudi Arabia Will Invest in Hollywood AI Company Luma

Hollywood-oriented AI is getting a major boost from the Saudi government, which is expected to announce Wednesday that it will anchor a $900 million funding round for Luma AI, the San Francisco company building models meant partly for entertainment.

Humain, the AI company backed by Saudi’s PIF, will be the lead investor in Luma AI’s latest funding round, which also includes powerhouse VC Andreessen Horowitz as well as early-stage investors Amplify Partners and Matrix Partners.. The size of Humain’s stake was not disclosed, but principals described it as significant.

The infusion greatly increases the capital coming into Luma, which in a few previous rounds from the lkes of AWS, a16z and Nvidia totaled just $70 million.

As part of the deal Luma will have access to large Saudi-based data centers that aim to generate 2 gigawatts  of computing power, roughly enough to power a mid-size city for a year. Luma will also open a Riyadh office.

“The sheer capacity and compute in Saudi Arabia is different from anywhere in the world,” Luma AI chief executive Amit Jain told The Hollywood Reporter ahead of the announcement, which is expected to be made at the Kennedy Center with a host of Saudi and American leaders as part of a larger set of deals between the countries. “This will allow us to do so many new things.”

Jain said the capacity and cash would be used to power “world models,” the vogueish idea in AI that the tech can map onto the physical world in order to understan human intelligence in a more intuitive way. While Large Language Models use prediction techniques to create video and images in addition to text, world models can, to their supporters, understand spatial and other reasoning in a way that would make them much more practically useful, though there is yet little real-world evidence that they can do this.

Jain said the world models Luma will build would have many use cases in Hollywood, including  the creation of new work.  “With a world model you make a 90-minute movie not just look like an Oscar winner visiually but in story, in flow,” he said. “You can iterate and go back and forth and it will have memory, something an LLM doesn’t have.”

 But the sheer computing power, while necessary, may or may not be sufficient to reach the level of artistic reasoning that such promises require.

The investment in such models is also likely to rankle many creatives in Hollywood, who are concerned about a huge influx of capital to efforts that could reduce their own ability to make a living.

While OpenAI and Google have garnered mainstream attention, Luma is one of a small number of of video-centric companies that have been garnering attention in the filmmaking world, thanks to backdrop-shifting tools like Modify and the viral short-generator Dream Machine last year.

 Jain said he plans to  make Luma’s world models available to Hollywood studios. The company recently opened a lab in Los Angeles to try to educate directors and executives on AI usage. He said 2027 was the target but 2028 was the more likely date for the full capacity of the Saudi data centers.

As Crown Prince Mohammed bin Salman makes a state visit to the White House, Saudia Arabia is seeking to become an AI powerhouse, leveraging its large open spaces and access to cheap energy to become an exporter of computing power. Earlier this year MBS created Humain as the official government-based AI company, not dissimilar to the oil-based Aramco. Oracle, Amazon, Microsoft and Elon Musk’s Grok have all reportedly met with Humain leadership. Backed by Saudi’s PIF, the company’s CEO, Tareq Amin, previously led Aramco’s digital efforts.

But questions remain about American companies doing business with Saudi given the country’s spotty record on human rights. Just seven years ago, after the death of Washington Post columnist Jamal Khashoggi at what U.S. intelligence officials wound up concluding was an act approved by bin Salman, Endeavor returned its $400 million investment from Saudi under heavy public pressure. Much of that resistance has evaporated as the Trump administration has aggressively sought to be in business with MBS and make deals to benefit American tech companies, like a deal earlier this year for Nvidia to sell coveted AI chips to Humain in exchange for massive Saudi investment in data centers.

Families of 9/11 victims and Khashoggi’s widow Hanan Elatr Khashoggi have raised their objections this week to the Crown Prince’s visit and the business arrangements, but asked about that by an ABC News correspondent Trump brushed off the 9/11 question and responded “things happen” about the Khashoggi murder after berating her as a “terrible person.” MBS, he said, has done a “phenomenal job.”

The Luma deal continues PIF’s entrees into entertainment, which included the recent backing of a deal to buy gaming company EA for $55 billion.

Jain said his deal grew out of a personal relationship he with Amin, the Humain leader. In a statement the Saudi exec praised Jain’s company. “Luma AI is an exceptional U.S.-based global frontier startup pushing the boundaries of multimodal world models. Their technical ambition, research velocity, and proven ability to turn foundational breakthroughs into real products make them uniquely aligned with Humain’s vision,” he said.

For his part, Jain said that he was focused on Human and Luma, which he said were “strategically aligned.” He said he personally found Saudi Araba to be a “very vibrant country” where “young people were extremely driven to try to do great things,” thanks to that youthful demographic and general spirit of entrepreneurship. Though the money for the investment comes from the government, he said he didn’t see this as a political deal.

“I don’t have reservations,” he said when asked about the Saudi government’s checkered history. “This is a very fruitful partnership where we can build something that will bring this incredible technology to the world.”