Perplexity , a startup aiming for Google's dominance in web search, has won the support of Jeff Bezos and venture capitalists who are betting that artificial intelligence will disrupt the way people find information online . The news is reported by the Wall Street Journal. The investment is part of a funding round that raised $73.6 million, valuing Perplexity at $520 million.
Founded less than two years ago, Perplexity has fewer than 40 employees and is based in a coworking space in San Francisco. The company's product, which it calls "Response Engine," is used by about 10 million people per month. Those ingredients were enough to convince Institutional Venture Partners, Bezos and other tech executives to invest $74 million in the company, the largest amount raised by an Internet search startup in recent years.
“To support our plans for rapid consumer adoption and expansion,” said CEO Aravind Srinivas – We raised $73.6 million in Series B funding from trusted venture capital firms and leading technology visionaries. IVP led the round with continued support from our investors NEA, Elad Gil, Nat Friedman and Databricks, as well as new investors NVIDIA, Jeff Bezos (via Bezos Expeditions Fund), Tobi Lutke, Bessemer Venture Partners, Naval Ravikant, Balaji Srinivasan , Guillermo. Rauch, Austen Allred, Factorial Funds and Kindred Ventures, among others. Based on ours A League earlier this year, we've raised $100 million to date.
Amazon.com, the e-commerce company chaired by Bezos, has committed to investing billions in Anthropique the AI startup behind the Claude chatbot . The path to competing with Google is strewn with carcasses, and Microsoft itself has struggled for years to chip away at its roughly 90% market share in online search.
Others, including tech giants, are integrating artificial intelligence into their search engines. Perplexity's founders said their advantage lies in using advances in AI to provide direct answers, rather than website links, in response to search queries, without some of the limitations felt by large businesses.
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AI search startup challenges Google
This could be the internet search version of David and Goliath. The perplexity could challenge Google as the dominant player in the search sector, writes the Wall Street Journal. Unlike Google, Perplexity uses artificial intelligence to give direct answers to search questions , instead of providing links to websites. The search engine has already attracted followers among tech workers.
The funding round was led by Institutional Venture Partners and saw participation from other investors such as Nvidia.
Although a relatively new player in the search engine market, Perplexity has seen significant growth: its website and mobile apps received 53 million visits in November 2024, up from 2.2 million when the service launches in December 2022.
The company's CEO, Srinivas, believes that by answering users' questions directly, there is no need to use the traditional "10 blue links" provided by other search engines.
Perplexity's research tools allow users to get immediate and reliable answers to questions with sources and citations.
Funds raised in the latest round will be used to drive customer adoption and global expansion.
Despite competition from established players like Google, Perplexity's focus on user experience and transparency could attract privacy-conscious users and tech professionals looking for new services using generative AI .
Amazon invests in Perplexity, comments
“Perplexity is intensively building a product that can bring the power of artificial intelligence to billions of people. The team has the unique ability to support a grand, long-term vision while relentlessly driving product requirements to solve a problem as important and fundamental as research,” he comments. Cack Wilhelm general partner of IVP, who led the round, joins Perplexity's board of directors.
“While there is a lot of excitement about AI's business-to-business and developer capabilities, AI will also transform the way we access information. Perplexity is at the forefront of this change, being one of the few consumer AI products to reach the important milestone of 10 million MAUs. Perplexity will become the one-stop shop for trusted information, which is why I'm excited that Perplexity is NVIDIA's first investment in the consumer sector by our business unit,” comments Jonathan Cohen, vice president of applied research at NVIDIA.
“With Perplexity's search tools, users get immediate and reliable answers to any question, with full sources and citations,” comments the nl blog. Aravind Srinivas, CEO of Perplexity. “There's no need to click multiple links, compare answers, or endlessly search for information. In an era where misinformation and AI hallucinations are of increasing concern, we believe that accuracy and transparency are prerequisites for making AI-based research ubiquitous. The days of sifting through SEO spam, sponsored links and multiple web pages will be replaced by a much more efficient way of consuming and sharing information, pushing our society into a new era of learning and accelerated research.
After our previous funding round, we launched Copilot , a first-of-its-kind AI research assistant that changed the way we discover information and approach new topics. Copilot personalizes search queries with personalized follow-up questions, introducing the concept of generative user interfaces. Copilot removes the engineering burden and doesn't force users to ask perfectly worded questions to get the answers they need. This allows users to get more relevant and complete answers than other AI chatbots, traditional search engines or search tools. Copilot has seen strong adoption, especially among academics, students, and knowledge workers who rely on frequent searches for their work and daily needs.
It's not just about our technology, but also how people use it. We are at the inflection point of a huge behavioral shift in how people access information online.
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