AI Search Engine Perplexity Valued at $1 Billion After Recent Funding Round

Perplexity AI, a startup developing an artificial intelligence-powered search engine, has secured $63 million in funding, valuing the company at over $1 billion. This valuation represents a significant increase from its previous valuation of $540 million in January.

The funding round was led by Daniel Gross, former head of AI at Y Combinator, with participation from new investors such as billionaire Stanley Druckenmiller, Y Combinator CEO Garry Tan and Figma CEO Dylan Field. Existing investors, including Nvidia Corp., (link unavailable) founder Jeff Bezos and others, also joined the round.

Perplexity’s search engine operates differently than traditional search engines like Google. Instead of requiring users to enter keywords and providing a list of results, Perplexity’s service offers an AI chatbot that allows users to pose natural language questions and receive conversational answers.

The company also recently announced the launch of Enterprise Pro, its first business offering, which provides enhanced security and privacy features for enterprise environments. The new service is priced at $40 per month and includes features such as team member management and query deletion after seven days.

Perplexity’s focus on accuracy has quickly distinguished its chatbot in a crowded market, with notable fans including Nvidia CEO Jensen Huang, who reportedly uses the product “almost every day.” The company has processed nearly 75 million user queries in the US this year, surpassing its total for all of 2023.

Perplexity offers both free and paid versions of its service and is generating $20 million in annual recurring revenue. The company is now focusing on expanding its user base and selling AI services to businesses. It has partnered with major carriers SoftBank Corp. and Deutsche Telekom AG to market its service to over 300 million users worldwide.