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Perplexity AI, the AI-powered search engine, has reportedly begun a new round of funding discussions, looking to more than double its valuation to $8 billion or higher.
According to The Wall Street Journal, the tech company, valued at $3 billion in June, is now seeking to raise approximately $500 million. Over the past year, it has already completed three rounds of funding. Sources cited by the Journal suggest that the startup’s annualized revenue—projected from recent sales for the next 12 months—is around $50 million.
The company is aiming to compete with industry giants like OpenAI, whose ChatGPT leads the market and recently secured one of the largest funding rounds in Silicon Valley history, raising $6.6 billion at a valuation of $157 billion. Perplexity CEO Aravind Srinivas mentioned that he was meeting with investors in recent days.
Met an investor yesterday, managing $50m of assets. "We tried using NotebookLM to do due diligence on potential companies to invest in, but there's no way to pull information from the web there or use the best models like Sonnet-3.5. Perplexity Spaces came at the right time."
— Aravind Srinivas (@AravSrinivas) October 18, 2024
Perplexity AI faces challenges amid funding discussions
Perplexity is a generative AI company offering a research-focused conversational search engine that responds to queries using natural language predictive text. To provide relevant answers, it searches the web and compiles information from credible sources such as articles, websites, and journals.
The system then compiles the most relevant insights into a response, complete with numbered footnotes linking to the original sources. The AI-driven “answer engine” was founded with support from Amazon CEO Jeff Bezos. However, earlier this month, ReadWrite reported that the New York Times issued Perplexity a ‘cease and desist’ notice, demanding it stop accessing and using its content.
This comes after the Times sued Microsoft and OpenAI for alleged copyright infringement back in December of 2023. This was one of the first legal fights about generative AI technologies and journalism to go public.
The company’s chief stated that the company is not disregarding the New York Times’s efforts to block access to its site and does not seek an adversarial relationship with news publishers.
In the past, Perplexity faced accusations of plagiarizing content from media outlets like Forbes and Wired, but it has since introduced a revenue-sharing program to address some of the concerns raised by publishers.
ReadWrite has reached out to Perplexity AI for comment.
Featured image: Perplexity AI
