AvatarOS was founded by Isaac Bratzel, who previously created the virtual influencer Lil Miquela at Brud and built Amelia 2.0 at IPsoft before joining Dapper Labs through acquisition. He started AvatarOS in 2022 to bring high-end, expressive virtual humans to a broader market.

Unlike tools aimed at quick, mass-produced avatars, AvatarOS focuses on premium 3D characters whose differentiation is the way they move through space, capturing the unique, non-uniform motion of real humans. The company currently produces customized avatars for clients while building self-serve creation and adjustment tools.

In March 2025 AvatarOS raised a $7M seed round led by M13's Latif Peracha, with participation from the Andreessen Horowitz Games Fund, HF0, Valia Ventures, and Mento VC. The funding supports team growth and development of a machine-learning-based deformer responsible for lifelike avatar movement.

AvatarOS targets brands, entertainment, and creators who want high-quality 3D virtual influencers and digital humans, positioning itself at the premium end of the avatar and digital-human market.