TechDogs-"Can AI Startup Perplexity Challenge OpenAI With Its Latest Funding Boost?"

Emerging Technology

Can AI Startup Perplexity Challenge OpenAI With Its Latest Funding Boost?

By TD NewsDesk

TD NewsDesk

Updated on Fri, Jan 5, 2024

Overall Rating
What’s the first thing that comes to your mind when you read the word “AI Chatbot”?

If you thought of “ChatGPT”, we wouldn’t blame you. It’s quite clearly the most popular AI chatbot out there, reaching 1 million users in just 5 days! That’s quite an achievement, right?

Ahead of this, it’s held its place as the market leader even after a year, having been released on November 30, 2022. Its success sparked numerous companies to come up with their own AI assistants and chatbots, while tech giants rushed to invest in AI companies. While the bigger companies have themselves covered financially, it’s the startups that feel the pinch.

Developing and deploying generative artificial intelligence (Gen AI) products can be an expensive affair. This is why companies engaged in the sector look towards raising funds to keep going, including OpenAI. You’ve certainly heard that Microsoft's investment in ChatGPT’s creator remains a staggering $13 billion!

With startups vying for more funding, the AI startup behind has gained popularity over the last year since its launch. The company now has some reassuring news. What’s it all about? Let’s explore!

What Did Perplexity Announce?

  • “Perplexity AI is a versatile and powerful AI chat tool that acts as a search engine, providing accurate and contextually precise answers by combining AI with web search and citing real sources, making it ideal for various tasks such as fact-checking, academic research, and content creation.”

  • The above sentence was generated by using the prompt “introduce in one sentence”.

  • In an announcement made through a blogpost, Perplexity said it raised $73.6 million in Series B funding from trusted VC firms and prominent tech visionaries.

  • The funding round, which was led by VC firm IVP, valued Perplexity at $520 million.

  • The company attracted investors such as NVIDIA, Amazon founder Jeff Bezos (through Bezos Expeditions Fund), NEA, Databricks, Bessemer Venture Partners and more.

  • The latest round amps up the total amount raised to $100 million, post the Series A funding earlier this year.

  • Having launched on December 7, 2022, Perplexity has grown to 10 million monthly active users and has served over half a billion queries in 2023. Furthermore, over a million people have installed the company’s mobile apps, across iOS and Android.

  • Yet, according to Perplexity, this is just the beginning, as their “ambition is to serve the entire planet’s unbounded curiosity, and we’re just getting started.”

What Did Stakeholders Say?

  • In a LinkedIn post, Aravind Srinivas, the co-founder and CEO of Perplexity, said, “Excited to announce we've raised 73.6M$ at 520M$ valuation, led by IVP, along with our seed and Series A lead investors NEA, Elad Gil, Nat Friedman. Honored to have NVIDIA, Jeff Bezos, Tobi Lutke, Databricks, Naval Ravikant, Guillermo Rauch, Balaji Srinivasan, Bessemer Ventures, Kindred Ventures, Factorial Funds, DVC, Austen Allred, Erik Torenberg partner in this round, among others.”

  • [Contd.] “We've served over half a billion queries in 2023, and gotten to 10M monthly active users. The funding will be used to further accelerate the transition from links to answers and expand more. Thanks to every investor and user who has supported us so far. We couldn't be here without all the help! We look forward to continuing to build the fastest and most accurate answer engine, to expand the knowledge of everyone in the world!”
  • Cack Wilhelm, General Partner, IVP, who led the round and joined Perplexity’s Board of Directors, said, “Perplexity is intensely building a product capable of bringing the power of AI to billions. The team possesses the unique ability to uphold a grand, long-term vision while shipping product relentlessly, requirements to tackle a problem as important and fundamental as search.”

  • Jonathan Cohen, VP of Applied Research at NVIDIA, said, “While there has been a lot of excitement around business-to-business and developer-related AI capabilities, AI will also transform how we access information.”

  • [Contd.] “Perplexity is at the forefront of this shift as one of the few consumer AI products to reach this major milestone of 10 million MAUs. They will become the go-to place for trusted information, which is why I am so excited that Perplexity is NVIDIA’s first consumer investment from our corporate arm.”

Do you think Perplexity will be able to challenge leading AI chatbots, such as ChatGPT and Bing, for the title of the most popular chatbot? How important will this latest round of funding be for the AI startup?

Let us know in the comments below!

First published on Fri, Jan 5, 2024

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