Perplexity AI, a startup specializing in AI-powered search solutions, is nearing the end of a major funding round, securing $500 million in investment at a valuation of $9 billion. This milestone was recently reported by The Wall Street Journal, citing a credible source. Competing with industry giants like Google and OpenAI, Perplexity has seen rapid valuation growth, having been valued at $3 billion just in June. Institutional Venture Partners, a California-based venture capital firm, leads the current investment round, marking significant progress for the startup. We’ll keep you updated on any further developments.
Growth in Valuation and Rising Popularity
Starting the year with a valuation of around $500 million after raising $73.6 million in a Series B, Perplexity AI has continued to attract strong investor interest, fueled by the generative AI surge. With four successful funding rounds completed in 2023 alone, Perplexity has captured attention across the tech investment landscape. The startup’s app has been downloaded over 2 million times and now processes more than 230 million requests each month, reflecting its expanding user base and engagement.
Plagiarism Concerns and Revenue-Sharing Solution
Despite its growth, Perplexity AI has faced plagiarism accusations from several major publications. The New York Times issued a warning letter in October, demanding the startup cease unauthorized use of its content. Similarly, Forbes reported in June that Perplexity AI Pages had replicated its paid content without proper attribution, aside from a small “F” logo at the page’s bottom. Wired also highlighted instances where its articles were reportedly used without consent.
Perplexity AI disputes these claims and has introduced a revenue-sharing model as a resolution, notes NIXSOLUTIONS. This model allocates a portion of advertising revenue generated from article citations to participating publishers. Media organizations like Fortune, Time, and Der Spiegel have already joined the program, which aims to address concerns while maintaining access to valuable content for users.
Rising Competition in AI Search
In response to Perplexity’s advancements, OpenAI recently expanded ChatGPT’s features to include a real-time search function, aiming to compete more directly with Perplexity, Google, and Microsoft’s Bing. This feature delivers up-to-the-minute information on a variety of topics, such as sports scores, stock updates, news, and weather, by integrating with news and data platforms.
Perplexity AI’s continued success, despite industry challenges, highlights its potential as a key player in AI-driven search innovation. We’ll keep you updated as the startup navigates this competitive landscape.