AI Search Startup Perplexity Hits $1 Billion Valuation Milestone

Perplexity AI, believing itself to become a good rival to Google Search, has freshly secured a funding of $63 million and this has pushed its value to more than $1 billion. The startup uses artificial intelligence (AI) to build a search engine.

The investment was announced on Tuesday and it is a great milestone for it as its worth has doubled in a period of just three months. Daniel Gross, along with billionaire Stanley Druckenmiller, Y Combinator CEO Garry Tan and Figma Inc. CEO Dylan Field backed Perplexity AI with fresh investment. The earlier backers included Jeff Bezos from Amazon and Nvidia Corp.

The startup is nearly two years old and provides an AI chatbot to summarize search results that offer citations and helps users improve their search queries for better responses. The search results have been praised for its accuracy. Notable users like Nvidia CEO Jensen Huang praised its utility.

Perplexity mainly focuses on accuracy and until now it has processed nearly 75 million user queries in the United States in 2024. The figure has surpassed that of 2023. The platform offers free as well as paid versions. It is currently generating $20 million in annual recurring revenue. It aims to increase revenue by catering to business clients.

Perplexity is rolling out an enterprise version of its chatbot and it is priced tagged at $40 per month. It offers enhanced security and data protection features. Some of the notable early adopters of the enterprise version include Bridgewater Associates, Zoom Video Communications Inc. and the Cleveland Cavaliers.

CEO Aravind Srinivas states that the main aim of Perplexity now is to expand the reach and to target every company in the US and thereafter explore the global markets. It has distribution partnerships with major carriers like Japan’s SoftBank Corp. and Germany’s Deutsche Telekom AG. The startup aims to reach over 300 million users worldwide.

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