Perplexity AI, a 2022-founded artificial intelligence startup challenging Google’s dominance in search, has closed a $500 million funding round, tripling its valuation to $9 billion, according to sources familiar with the matter. Institutional Venture Partners led the round, finalized earlier this month. Perplexity declined to comment on the development.
The startup’s valuation has skyrocketed in 2023, beginning the year at $1 billion, climbing to $3 billion in June following an investment from SoftBank Group Corp.’s Vision Fund 2, and now reaching $9 billion with the latest funding. This rapid growth underscores investor confidence in Perplexity’s mission to integrate generative AI into search, reshaping how users access information online.
Perplexity has differentiated itself by delivering real-time search results alongside its AI chatbot features. Its services include free and paid search tools, as well as offerings tailored for enterprise users to search internal files. Recent additions to its platform include finance-related features like stock price lookups and company earnings data. In March, Perplexity reported over 15 million active users.
The company has also addressed concerns over intellectual property by forming revenue-sharing agreements with major publishers, such as Time and Fortune, after facing allegations of plagiarism from some news outlets.
Despite its momentum, Perplexity faces mounting competition. OpenAI recently expanded its search capabilities for ChatGPT users, while Microsoft and Google continue to enhance their search products with conversational AI features.
Perplexity’s latest funding follows previous investments from notable backers, including Amazon founder Jeff Bezos, NVIDIA Corp., and SoftBank. This financial backing positions the company to further innovate in the competitive AI-driven search market.
