In a bid to challenge industry titans, San Francisco-based startup Perplexity AI has secured a substantial $73.6 million investment from a consortium of investors, including tech giants Nvidia and Amazon founder Jeff Bezos. This funding round, spearheaded by venture capital firm IVP, pegs the company’s valuation at approximately $520 million.
Perplexity AI specializes in cutting-edge search tools designed to provide instant, well-cited answers to user queries. Its arsenal comprises various large language models (LLMs) like OpenAI and Meta’s open-source model Llama, enabling comprehensive information synthesis.
The company’s prior success includes servicing over 500 million queries in 2023, a feat achieved with minimal marketing expenditure. With expansion in mind, Perplexity plans to utilize the funding to augment its workforce, intending to grow from its current 38 employees to around 60 by year-end.
Boasting a significant surge in traffic, the company’s website and mobile web witnessed a staggering rise from 2.2 million visits at launch in December 2022 to a whopping 45 million visits in December of the following year, as reported by Similarweb.
Despite its rapid growth trajectory, Perplexity AI operates within a highly competitive market dominated by Google, holding around 90% market share in online searches. While Microsoft’s Bing, integrated with AI technology from OpenAI, has attempted to gain ground, it has struggled to make a substantial dent in Google’s dominance.
Aravind Srinivas, the CEO of Perplexity, attributes the startup’s potential to its strategic focus and the versatility to fine-tune multiple high-performing AI models, rather than being tethered to a single approach. This strategy positions Perplexity AI as a formidable contender in the evolving landscape of AI-driven search technologies.