Perplexity AI In Funding Talks, Targeting Valuation Up To $8 Billion: Report

Perplexity AI, a Jeff Bezos-backed AI-powered search engine startup, has started fundraising talks that would result in its valuation of up to $8 billion or more.

A report on Wall Street Journal indicated that the company relayed to investors the amount that it was trying to raise, which was around $500 million.

The report also indicated that based on the recent sales of the company, it estimated an annual revenue of about $50 million.

According to CNBC, in June, the company was valued at around $3 billion, but with the planned fundraising, the figure could change exponentially.

Perplexity is among the many AI startups that would like to have a bite of the booming AI market, which at present is being dominated by OpenAI, the force behind the worldwide phenomenon ChatGPT.

Meanwhile, OpenAI also recently closed one of the largest funding rounds, where it raised $6.6 billion with a valuation of $157 billion. The funding, by Silicon Valley standards, was among the largest ones.

Founded in 2022, Perplexity was embroiled in controversies, crossing swords with a number of known news publishers.

It was only in October when the company received a "cease and desist" order coming from the New York Times. The latter was claiming that the startup was using its content for generative AI purposes, hence, the order for it to stop doing so.

The complaint made by New York Times was not the first time that such allegations were made against the Nvidia-backed AI company. Before NYT, it was also accused by Forbes and Wired, both of which claimed that the company plagiarized their content. Since then, there was already a revenue-sharing program that was put forward in response to the concerns of a number of publishers.

Reuters noted that the search tool of Perplexity is powerful such that users are able to get instant answers to questions, which includes sources and citations. The backbone of the tool is powered by several large language models, which has the capacity to sum up and generate information right from OpenAI to Meta's open-source model Llama.

Perplexity is designed to enhance traditional search experiences by blending generative AI with web-based research and is considered truly powerful since it combines the features of a search engine and an AI chatbot.