Perplexity AI Secures $500M Funding, Valuation Soars to $9 Billion Amid AI Search Engine Boom

Perplexity AI Raises $500M: A Major Boost for AI Search and Generative AI

Perplexity raised US$73.6 million in Series B funding way back in January at a US$520 million valuation. Reaching US$9 billion will be a huge hike. It speaks volumes to investor interest in AI firms especially those that build upon large language models or other generative AI-related technologies. Perplexity AI is a Generative AI, powered by advanced cutting-edge AI technologies that gives users super-fast and highly accurate internet information with data sources. In a stride to dethrone the search engine leader Google and its dominance of the sector, Perplexity employs AI-driven innovative search characteristics. Thus, making a difference both in the life of a typical user and providing efficient solutions at the business end. The AI startup is backed by many influential figures in the tech world, including Amazon founder Jeff Bezos and AI chip giant Nvidia. This further solidifies Perplexity's stand in the AI market.

Perplexity AI's value to soar to $9B as it finalizes new $500M funding round - SiliconANGLE

Perplexity AI's value to soar to $9B as it finalizes new $500M funding round Generative artificial intelligence search startup Perplexity AI Inc. reportedly is finalizing the details of a mammoth new funding round that would increase its valuation to a cool $9 billion. The startup, which has built an AI-powered search engine platform and competes with both Google Search and OpenAI's ChatGPT, is set to receive $500 million in the round. The San Francisco-based venture capital firm Institutional Venture Partners is leading the round, according to reports by the Wall Street Journal and CNBC, which both cited anonymous sources. The round would make Perplexity one of the most valuable generative AI startups of all. At the beginning of the year, it was valued at just $520 million, but successive funding rounds increased that number to $3 billion at the end of June. All told, it has announced four funding rounds this year alone. Perplexity is attracting more investor cash even as its rivals step up their efforts to better compete against it. Last week, OpenAI unveiled a new search feature with ChatGPT, its viral chatbot, while Google Search and Microsoft Corp.'s Bing search engine have also added AI capabilities. In the case of ChatGPT's search feature, it provides up-to-the-minute sports scores, stock prices, news headlines, weather and more, powered by its real-time internet search capabilities and partnerships that its parent company has forged with various publishers and data providers. Despite the competition, Perplexity has done fairly well itself, with its search app being downloaded more than two million times to date. In August, it said it handles around 230 million search queries each month. Last month, the Journal said its annualized revenue stands at about $50 million. Like Google, Perplexity's AI engine searches the web for the most up to date information, but rather than produce a list of links, it will respond to users' queries in a manner that's more akin to ChatGPT. The startup's tools are free to use, but it makes money from selling premium subscriptions that come with more advanced features. Besides targeting consumers, it has also launched an enterprise-grade version of its search engine for businesses. That version can also search a company's internal files to answer business-related questions. The company also has plans to integrate advertising with its platform, but it has not yet done so. Perplexity has also attracted a fair share of controversy amid its rise, with a number of media outlets complaining that its search engine basically plagiarizes their content when it produces its answers. In September, the New York Times reportedly sent Perplexity a cease and desist letter, asking it to stop crawling its web pages and using its content to generate answers. The Times accuses Perplexity of simply scraping its web articles, but the startup denies this. Other websites, such as Forbes and Wired.com, have also accused Perplexity of plagiarism, and the Journal's parent company Dow Jones has gone further, suing the company over its practices. Responding to this controversy, Perplexity has held out an olive branch in the shape of a revenue-sharing model for publishers. It's inviting media companies to sign up to the program, and anytime it generates ad revenue from a response that cites one of their articles, it will share a percentage of that money with them. The initiative appears to have satisfied quite a few publishers, with the likes of Fortune, Time, Entrepreneur, The Texas Tribune, Der Spiegel and WordPress all signing up to the program. For publishers it could be pretty lucrative. In a July interview with CNBC, Perplexity's chief business officer Dmitry Shevelenko said that if one of its answers cites three different articles from the same publisher, that partner would earn "triple the revenue share", compared to if just one link was used.

Perplexity AI in final stages of raising $500 million round at $9 billion valuation

Perplexity AI logo is seen in this illustration taken January 4, 2024. Perplexity AI, the artificial-intelligence search engine startup, is in the final stages of raising $500 million in funding at a $9 billion valuation, a source familiar with the situation told CNBC. The startup competes against the likes of Google and ChatGPT-maker OpenAI. Perplexity most recent valuation was $3 billion in June. Institutional Venture Partners, a Bay Area-based firm, is leading the new round, according to the source, who requested anonymity since the funding is not yet public. Perplexity started the year with a roughly $500 million valuation. Since then, the company has continued to attract investor interest amid the generative AI boom, raising four funding rounds so far this year. Last week, OpenAI launched a search feature within ChatGPT, its viral chatbot, that positioned it to better compete with Perplexity, as well as leading search engines like Google and Microsoft's Bing. OpenAI's search feature offers up-to-the-minute sports scores, stock quotes, news, weather and more, powered by real-time web search and partnerships with news and data providers, according to the company. Despite the AI boom, Perplexity has been embroiled in controversy due to accusations of plagiarizing content from media outlets. The New York Times last month sent Perplexity a "cease and desist" notice, claiming that the startup scrapes the news outlet's content to generate answers. Perplexity has denied the allegations. In July, Perplexity debuted a revenue-sharing model for publishers. Any time a user asks a question and Perplexity generates ad revenue from citing an article in its answer, Perplexity will share a percentage of that revenue with the publisher, the company said. Media outlets and content platforms including Fortune, Time, Entrepreneur, The Texas Tribune, Der Spiegel and WordPress were among the first to join the company's "Publishers Program." Dmitry Shevelenko, Perplexity's chief business officer, told CNBC in a July interview that if three articles from one publisher were used in one answer, the partner would receive "triple the revenue share." Perplexity worked on its revenue-sharing model since January, and the company's goal is to have 30 publishers enrolled by the end of the year, Shevelenko said. Perplexity's app has been downloaded more than 2 million times, and it answers more than 230 million queries a month, the company said in August. U.S. queries have increased eightfold in the past year, according to a pitch deck for potential advertisers that was viewed by CNBC.

Perplexity raising new funds at $9 billion valuation, source says

(Reuters) - Perplexity is raising new investment that would value the search startup at $9 billion, a source familiar with the matter said on Tuesday, a sign of heightened investor enthusiasm around artificial intelligence companies. California-based Perplexity is set to raise $500 million in the new funding round led by venture capital firm Institutional Venture Partners (IVP), which also holds a board seat in the startup, the source said. The company had raised $73.6 million in Series B funding in January. The funding round, led by IVP, had valued the company at about $520 million. The meteoric success of OpenAI's ChatGPT has attracted investors to AI startups as businesses are racing to adopt the technology. Building large language models (LLMs) also requires billions in funding. OpenAI closed a $6.6 billion funding round last month, which could value the company at $157 billion and cement its position as one of the most valuable private companies in the world. Since the release of ChatGPT, publishers have been raising the alarm on chatbots that can comb the internet to find information and create paragraph summaries for the users. Media conglomerate News Corp-owned publishers sued Perplexity in October, claiming that the startup engages in a "massive amount of illegal copying" of their copyrighted work. New York Times also sent Perplexity a "cease and desist" notice last month, demanding it stop using the newspaper's content for generative AI purposes. Perplexity, which provides information by searching the internet, is also backed by Amazon.com founder Jeff Bezos and chip designer Nvidia. The AI company is among the leading firms attempting to uproot the search engine market dominated by Alphabet's Google. The Wall Street Journal first reported on the funding being finalized by Perplexity. (Reporting by Jaspreet Singh in Bengaluru; Editing by Subhranshu Sahu)

AI Startup Perplexity Set to Reach $9 Billion Valuation | PYMNTS.com

Perplexity, an artificial intelligence (AI)-powered search engine, is set to triple its valuation from a few months ago following its latest funding round. The company is due to raise $500 million in its fourth funding round this year, according to a Tuesday (Nov. 5) report from The Wall Street Journal, which cited people familiar with the matter. This would value Perplexity at $9 billion. It started this year with a valuation of $520 million. Its 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. Perplexity, which provides answers to user queries based on information it gathers from the web, has been widely criticized by news companies for using their reporting without appropriate compensation. Two News Corp-owned publishers -- WSJ parent company Dow Jones and the New York Post -- filed a copyright infringement lawsuit against Perplexity in October. The publishers allege that the AI startup uses their copyrighted content to answer users' questions, in some cases reproducing entire articles, and siphons off traffic that would otherwise have gone to the publishers' sites. "This suit is brought by news publishers who seek redress for Perplexity's brazen scheme to compete for readers while simultaneously freeriding on the valuable content publishers produce," the publishers said in their complaint, per an Oct. 21 WSJ report. This lawsuit comes after Perplexity failed to respond to a letter that the publishers had sent in July outlining their concerns. CEO Srinivas reportedly said Oct. 23 that he was surprised by the lawsuit and that he was interested in a "proper commercial discussion." "Srinivas said ... that Perplexity wants to form revenue-sharing partnerships with news publishers, per the report," PYMNTS said. "He said that he is not interested in signing licensing agreements with publishers, instead suggesting that the company would share advertising revenue with publishers." Perplexity will launch an advertising program in November, according to an Oct. 23 WSJ report. Srinivas also said that Perplexity could give publishers access to chatbots that would respond to users' queries on the publishers' websites, using their content to provide answers, per the report.

Jeff Bezos-Backed AI Startup Perplexity Set To Triple Valuation To $9B in Fourth Funding Round -- Can It Beat OpenAI And Google? - Alphabet (NASDAQ:GOOG), Alphabet (NASDAQ:GOOGL)

AI startup Perplexity, backed by Amazon.com, Inc. founder Jeff Bezos, is set to triple its valuation in its fourth funding round this year. What Happened: Perplexity is finalizing a funding round that would see its valuation skyrocket to $9 billion, an increase from its valuation of $520 million at the start of the year. The AI-powered search company plans to raise $500 million, with Institutional Venture Partners leading the round, reported the Wall Street Journal, citing people familiar with the matter. The funding comes amid increased competition from ChatGPT-parent OpenAI and Alphbaet Inc.'s GOOG GOOGL Google, both of which have introduced AI-powered features in their search engines. Last month, OpenAI secured more than $6.5 billion in new funding at a valuation of $157 billion. Subscribe to the Benzinga Tech Trends newsletter to get all the latest tech developments delivered to your inbox. Why It Matters: In April 2024, Perplexity became a unicorn after a funding round that more than doubled its valuation to over $1 billion. By August, the startup's revenue and usage had grown 700% since the start of the year. Last month, Perplexity introduced new features aimed at improving user experience and breaking the duopoly of Google and Meta Platforms in the search and advertising industry. However, the AI startup, which provides answers to questions by searching the web, has also faced criticism from news companies for using their reporting without fair compensation. Check out more of Benzinga's Consumer Tech coverage by following this link. Photo courtesy: Shutterstock Read Next: 'AI Haves Vs. Have-Nots': Palantir's Ryan Taylor Outlines Company's Winning Strategy Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors. Market News and Data brought to you by Benzinga APIs