I’ll give you some basic details about a new startup — and you can guess where the company is based.
- Founders are PhDs and former Apple engineers.
- Ambitious vision to build a foundation AI model.
- Just raised $10 million from Bay Area investors.
San Francisco startup, right?
Nope.
One of the more intriguing aspects of Nuance Labs is that the nascent startup with big dreams decided to build in Seattle.
It’s a detail that caught our attention given GeekWire’s recent reporting on Seattle’s startup ecosystem in the AI era — and critiques about the lack of hustle compared to San Francisco and Silicon Valley.
We’ve been hearing rumblings about Nuance, which was working out of Foundations, the growing Seattle-based startup community.
The 4-person startup recently raised $10 million in a round led by Accel, with Lightspeed and South Park Commons also investing. Upstarts Media reported on the funding Tuesday.
Founded earlier this year, Nuance is developing its own AI system capable of understanding and expressing emotion in real-time across multiple modalities. Its investors are betting that a small startup can take on well-funded behemoths with a unique take on making AI less robotic and more realistic.
Betting on Seattle
During the company’s fundraising process, the founders were ready to relocate to San Francisco, billed as the tech industry’s hub for AI. But they ended up staying in Seattle.
“As all of our conversations with candidates evolved, it just turned out that more and more people within our networks in Seattle were the ones who were most enthusiastic about joining this mission,” Edward Zhang, co-founder and CTO of Nuance, told GeekWire.
Zhang, who earned his PhD in computer graphics from the University of Washington, met Nuance co-founder Fangchang Ma at Apple’s engineering office in Seattle.
Ma landed at Apple in 2019 after getting his PhD in robotics and machine learning from MIT in Boston.
“Over the years, I’ve met a lot of amazing talent here,” Ma said. “The way I see it, there’s a huge untapped talent pool for startups in Seattle.”
The founders also cited a more down-to-earth vibe of the Seattle ecosystem versus the Bay Area, which they said is a bit more “indexing on the hype.”
“There’s a natural difference between the two communities,” Zhang said. “We definitely enjoy the one here quite a bit.”
Ma and Zhang admit that San Francisco still has stronger support for startups. But they want to be part of building that up in Seattle, citing efforts like Foundations and the AI2 Incubator.
“We want to be the premier research lab in Seattle,” Ma said.
The company does plan to establish a footprint in the Bay Area once it grows. “We do like the energy there,” Ma said.
Notably, Nuance does not have any Seattle investors on its cap table.
“This is a pretty high-risk technical bet,” Ma said. “It’s not quite the typical profile or portfolio for Seattle investors, and we understand that.”
He added: “I think to really build up the ecosystem for startups, we do need more people who are willing to take high-risk, high-reward kind of bets. We’re definitely in that category.”
Emotionally intelligent AI
Nuance believes that existing AI tools and experiences lack the ability to generate and understand genuine emotional presence — especially in real time.
“Our vision is to create emotionally intelligent conversational AI that feel as natural to engage with as a human,” the company says on its website.
Rather than just predicting text, Nuance aims to model tiny slices of human behavior — such as a slight pause in speech or a shift in facial expression.
Its approach uses auto-regressive transformers — a type of AI that predicts the next step in a sequence based on what came before — to mimic human behavior one frame or token at a time. The goal is to enable both empathetic interpretation and authentic expression in real-time, interactive settings.
Nuance is focused on efficiency — rather than relying on generalized LLMs, its model is specialized to learn and predict emotion directly. This approach allows it to train more economically and perform faster.
Zhang and Ma say they envision Nuance developing consumer applications — such as AI avatars that can see and respond to users, or software that analyzes emotions during video calls.
It also sees itself as somewhat of an “OpenAI for emotional intelligence” — providing the API to support different use cases such as AI therapists.
Nuance plans to move into a new office in downtown Seattle. The startup recently added two employees:
- Karren Yang: Research scientist with expertise in audio-visual synthesis. PhD from MIT, previously a senior AI/ML researcher at Apple in Seattle.
- Claudia Vanea: Research scientist with an Oxford AI PhD, background in AI for health. Recently relocated from London.
Asked how they are competing with tech giants offering huge financial incentives to attract top AI researchers, the Nuance founders say it’s their unique focus and ability to move fast.
“The fundamental incentives and structures of large organizations just make it much harder to actually be able to build something big, but be able to move fast at the same time,” Zhang said.
