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Today, Perplexity AI, a California-based startup that aims to transform knowledge discovery with its AI-native search engine, announced it has secured $73.6 million in its series B funding round. The funding comes from IVP, with contributions from NEA, Databricks, Nvidia, Bessemer Venture Partners, and Kindred Ventures.
Several notable tech pioneers also supported this round, including Amazon founder Jeff Bezos, former X VP Elad Gil, GitHub CEO Nat Friedman, Shopify CEO Tobi Lutke, and Vercel founder Guillermo Rauch.
With this new capital, Perplexity AI, which has now raised $100 million in total and is valued at over $500 million, plans to enhance its AI-powered search engine to challenge industry giants Google and Microsoft amid the rise of generative AI and large language models (LLM).
Unlike Google and Microsoft, who have long dominated the search engine space, Perplexity believes it can offer a more native AI experience. Their platform combines web indexes with various AI models to provide direct answers to user queries in a conversational format, eliminating the need to click through multiple links or ads.
To further improve user experience, Perplexity allows users to explore the details of the provided information through relevant sources and citations. Emphasizing accuracy and transparency in an era troubled by misinformation and AI errors, the platform aims to streamline information consumption and foster a new era of accelerated learning and research.
The company offers a free version of its platform, but for $20 a month, users can subscribe to the Pro version, which allows them to choose their preferred model, including GPT-4, for enhanced results. The subscription also provides access to Perplexity API credits to integrate advanced open-source LLMs into projects and offers unlimited querying support through Perplexity Copilot, their interactive research assistant.
Perplexity Copilot refines search queries with custom follow-up questions, introducing the concept of generative user interfaces. This feature minimizes the need for precise prompt engineering, making it easier for users to obtain comprehensive and relevant information compared to traditional search engines or other AI chatbots.
Since launching a year ago, Perplexity’s search engine has gained substantial traction, boasting 10 million monthly active users and more than a million mobile users. The platform handled over half a billion queries in 2023, with its Copilot service proving popular among academics, students, and knowledge workers.
While the company has made a strong start, it acknowledges that it is still far from achieving its mission to cater to global curiosity. In contrast, Google and Microsoft have billions of users and are already integrating generative AI into their services. Google’s new Gemini model has reduced response latency significantly, while Microsoft’s Bing uses OpenAI’s GPT-4 for information search and DALL-E 3 for image generation. However, unlike Perplexity, both companies include links and ads in their search results.
The future will reveal how Perplexity leverages its unique features, like model flexibility, to compete with these tech giants and scale its platform to revolutionize knowledge discovery in an AI-driven world.