Artificial intelligence startup Perplexity announced a series of milestones and updates on 4 January. The highlight of the news was the company’s successful completion of its Series B, which raised $73.6 million. The fundraising was led by IVP, whose investment portfolio includes numerous crypto and fintech companies such as Coinbase and Robinhood. Series A investors NEA, Elad Gil, Nat Friedman and Databricks also participated. It also included new investments from Nvidia and Jeff Bezos (through the Bezos Expeditions Fund). TechCrunch noted that the Series B fundraising took place at a valuation of $520 million. It has raised $100 million to date, according to Perplexity.
While Perplexity is one of the lesser-known players in the search engine and generative artificial intelligence (AI) spaces, it has a relatively quick turnaround, from inception to a reported half-billion-dollar valuation (the company was founded less than two years ago). The company’s CEO, Aravind Srinivas, previously interned at DeepMind, Google and OpenAI before working as a research scientist for OpenAI. Denis Yarats, Perplexity’s chief technology officer, used to work at Facebook and Microsoft, according to their LinkedIn page.
Perplexity’s entry into the search and generative AI spaces comes as Big Tech invests in chatbot technology to lead the way in both sectors. Google and Microsoft have moved towards AI-first interfaces for their flagship search products, Search and Bing. Analysts also estimate that the productive AI sector alone could be worth $667bn by 2030.
Perplexity differs from Big Tech offerings in terms of choice. Users can choose to summarise search results and generate outputs using Perplexity’s in-house AI models, or they can choose some of the most popular models, including OpenAI’s ChatGPT, Anthropic’s Claude and Google’s Gemini. But there are also striking similarities. Much like Microsoft, Perplexity offers an AI assistant called Copilot. While the two products may seem unrelated, they appear functionally similar.