Artificial intelligence startup Runway on Monday announced Gen 4.5, a new video model that outperforms similar models from Google and OpenAI in an independent benchmark.

Gen 4.5 allows users to generate high-definition videos based on written prompts that describe the motion and action they want. Runway said the model is good at understanding physics, human motion, camera movements and cause and effect.

The model holds the No. 1 spot on the Video Arena leaderboard, which is maintained by the independent AI benchmarking and analysis company Artificial Analysis. To determine the text-to-video model rankings, people compare two different model outputs and vote for their favorite without knowing which companies are behind them.

Google's Veo 3 model holds second place on the leaderboard, and OpenAI's Sora 2 Pro model is in seventh place.  

"We managed to out-compete trillion-dollar companies with a team of 100 people," Runway CEO Cristóbal Valenzuela told CNBC in an interview. "You can get to frontiers just by being extremely focused and diligent."

Runway was founded in 2018 and earned a spot on CNBC's Disruptor 50 list this year. It conducts AI research and builds video and world models, which are models that are trained on video and observational data to better reflect how the physical world works.

The startup's customers include media organizations, studios, brands, designers, creatives and students. Its valuation has swelled to $3.55 billion, according to PitchBook. Runway's investors include General Atlantic, Baillie Gifford, Nvidia and Salesforce Ventures, among others.

Valenzuela said Gen 4.5 was codenamed "David" in a nod to the biblical story of David and Goliath. The model was "an overnight success that took like seven years," he said. 

"It does feel like a very interesting moment in time where the era of efficiency and research is upon us," Valenzuela said. "[We're] excited to be able to make sure that AI is not monopolized by two or three companies." 

Gen 4.5 is rolling out gradually, but it will be available to all of Runway's customers by the end of the week. Valenzuela said it's the first of several major releases that the company has in store.

"It will be available through Runway's platform, its application programming interface and through some of the company's partners," he said.

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