NEW YORK (TIP) : AI-powered search engine Perplexity is due to raise $500 million in its fourth funding round this year, The Wall Street Journal reported on Tuesday, November 5, which would value the startup at almost $9 billion.
The latest valuation is triple the amount from a few months ago. The AI startup, which helps people search the web using a ChatGPT-style interface, is reported to receive 100 million queries every week and brings in around $50 million in annual revenue.
Perplexity’s rapid growth highlights strong investor interest in its offerings, WSJ said, and marks it as one of the most valuable AI startups amid a new wave of generative AI technology.
Notable investors backing Perplexity include Nvidia, Databricks, Amazon’s Jeff Bezos, Y Combinator’s former Head of AI Daniel Gross and present Chief Garry Tan, Figma’s Dylan Field, among others.
Perplexity joins other generative AI contenders, such as OpenAI’s ChatGPT, Microsoft’s Bing, and Google’s Gemini AI in the search space but claims to set itself apart by using multiple large language models to deliver more accurate and richer responses.
Launched in 2022, Perplexity was founded by Indian American Aravind Srinivas who previously held research-oriented roles at OpenAI, Google, and DeepMind. An IIT Madras alum with a PhD in computer science from the University of California, Berkeley, Srinivas aims “to build the world’s most knowledge centric company.”
Recently, Srinivas faced backlash from two News Corp-owned publications – The New York Post and WSJ’s parent company Dow Jones – regarding Perplexity’s ability to provide answers to user queries based on web-scraped data which includes original reporting from the publications.
Both news publications filed a copyright infringement lawsuit against the AI startup in October. In the same month, Perplexity has also been sent a cease and desist letter from The New York Times demanding to stop using its content in the AI platform’s output. This is not NYT’s first feud with an AI company – last year, it sued Microsoft and OpenAI for unethical web scraping to train ChatGPT and other AI products.
The publishers allege that using their content, the AI platforms have siphoned traffic that would have otherwise directed visitors to their own websites.
Reportedly, Srinivas was “surprised by the lawsuit” by the News Corp-owned publications and that he was interested in a “proper commercial discussion,” according to PYMNTS.
In a WSJ Tech Live held two days after the lawsuit was filed, Srinivas proposed to form revenue-sharing partnerships with the news publishers and revealed that Perplexity will be launching an advertising program in November.
“I don’t think just licensing content is the only solution,” Srinivas said. “Neither am I saying our publisher program is already there. I hope that more conversations will get us there.”