A Belarussian millionaire living in Cyprus. A dinner with the CEO of Snap. A six-figure patent troll case. They are all part of the history of Prisma Labs, a largely obscure artificial intelligence startup that spent years under the radar until November, when the company introduced "Magic Avatars." The feature in Prisma's Lensa app has allowed millions to turn mundane selfies into dazzling AI-generated animated portraits of fairy princesses and astronauts. And it has brought in tens of millions of dollars. Now, Prisma is trying to capitalize on the magic. Company executives are scrambling to come up with ways to...