Indian Startup Zupee Acquires Nucanon to Expand into Interactive Storytelling

Zupee has acquired Sydney-based Nucanon to add a proprietary AI world-building engine to its platform, enabling dynamic, branching narratives and interactive characters. The deal extends Zupee’s reach beyond social gaming into AI-driven storytelling and positions India as a growing hub for narrative innovation.

The acquisition of Nucanon is more than a product buy; it’s a strategic pivot. Zupee is leveraging Australia’s narrative-AI capability to move from short-form social games into a creator-centric entertainment stack where stories behave more like live services than static content. This cross-border deal highlights how platforms in India are buying technological building blocks to own longer attention spans and a new creator economy centred on interactive narratives.

The Facts:

• Zupee announced the acquisition of Nucanon, a Sydney-based developer of AI-driven interactive storytelling, on 3 November 2025.

• Nucanon’s core technology is a proprietary world-building AI engine that creates branching narratives, adaptive dialogue and evolving characters.

• Post-acquisition, Nucanon’s founding team will lead product innovation from Zupee’s India offices, and the technology will form the backbone of a dedicated interactive storytelling vertical.

• Zupee said it will expand its product, technology and design teams and invite creators to build on the new platform.

The deal signals three connected shifts:

1. Platform play to narrative platform: Zupee is transitioning from quick, social gaming sessions to longer, engagement-heavy storytelling formats that can sustain subscriptions, episodic spending or creator monetisation.

2. Tech import, creative export: By acquiring the AI engine and relocating product leadership to India, Zupee can fuse offshore R&D with local storytelling, potentially producing culturally resonant interactive content at scale.

3. Creator economy growth: Interactive stories give creators new formats — branching plots, character memory and voice/text mediums — that can be monetised beyond conventional ad or prize models.

What Nucanon brings

Nucanon’s AI claims to make narratives responsive in three ways:

• Dialogues that “feel authentic and spontaneous.”

• Characters that “remember past interactions”.

• Plots that “shift in response to each decision.”

This allows users to “move freely within the world without breaking its flow or structure,” turning passive viewers into active participants across text, voice or visual channels.

Operational notes and integration

• Nucanon’s founding team will lead product innovation from India, signalling Zupee’s intent to centralise product development locally.

• The company is hiring across product, technology and design and inviting creators to join the new vertical — a clear push to build an ecosystem rather than run a point product.

Risks:

• Moderation and safety: Dynamic narratives that adapt to user input raise moderation challenges — how will Zupee prevent harmful or toxic content generated in real time?

• Creative control vs. AI authorship: Balancing AI-driven generation with human creative intent remains complex; creators may need tools to steer AI outputs reliably.

• IP and rights: With procedurally generated content, licensing and revenue share models will need clear definitions to protect creators and platforms.

• Monetisation model: Moving from short-session social games to longer narrative forms requires different pricing, retention and discovery strategies.

Dilsher Singh Malhi, Founder and CEO of Zupee, said, “At Zupee, we have always liked to push the boundaries on innovation. We're very excited about partnering with Nucanon and building the future of how humans will experience stories. For decades, we've been trapped between two worlds: the emotional depth of cinema and the agency of games. With Nucanon we want to crack something fundamental — which is not just generating content but understanding narrative causality. We believe the Pixar of the next century won’t emerge through traditional film or animation, but rather through an interactive mix of videos and games. And we're going to build it from India for the world.”

"The holy grail of interactive entertainment is true player agency within a compelling story. This is the challenge that has stumped the industry for decades, and it's the one we were founded to solve," said Nilushanan Kulasingham, CEO of Nucanon. "Our goal is to build an AI that doesn't just generate text; it understands the story. With Zupee's backing, we now have the resources to take on this challenge at scale."

The Zupee–Nucanon deal is a pragmatic bet: acquire narrative AI capability, anchor product leadership in India, and invite creators to build interactive IP. If Zupee can solve moderation, creator tooling and monetisation, the acquisition could help shift digital entertainment toward experiences that reward longer attention and deeper engagement. For India’s games and media sectors, it’s a test case in building global entertainment tech from a local base.