AI Search Platform Perplexity Raises $250M+ at $2.5B-$3B Valuation

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Hot Property Alert: Perplexity Raises at Least $250 Million More at a Valuation of Between $2.5 Billion and $3 Billion

TechCrunch has learned that Perplexity, the AI search engine startup, is currently raising at least $250 million more at a valuation of between $2.5 billion and $3 billion. This news comes on the heels of two other big fundraises that have seen the company’s valuation leapfrog in the last four months.

Recent Fundraises and Valuations

In January, Perplexity raised nearly $74 million at a valuation of $540 million (up from $121 million in April 2023). At the beginning of March, the company closed funding on a valuation of $1 billion, with CEO Aravind Srinivas clarifying on Twitter that the amount raised was roughly $63 million.

These two reported rounds are not the full story. We understand from multiple sources close to the company that Perplexity is raising a further round of at least $250 million to capitalize on the attention it’s getting in the market. NEA, SoftBank Vision Fund 2, and Tiger Global Management are among those participating in this latest funding round.

Why Raise Again So Soon?

The startup offers its tools on free and enterprise, paid tiers, and so far, it has processed 75 million queries this year and is currently on ARR of $20 million, according to Bloomberg. Its reason for raising again so soon? Yes, perhaps to capitalize on customer and investor interest at what one investor described as a "zeitgeist moment" for the startup. But also because of the mechanics of building any kind of AI service right now.

The Mechanics of Building an AI Service

One investor noted that compute is very expensive, so they may need to raise for that reason alone. Perplexity’s CEO, Aravind Srinivas, was not available for comment at the time of writing, but we have reached out and will update this post as we learn more.

Focus on Enterprise and Search

Perplexity is not the only startup in AI that is building on very focused opportunities and by targeting enterprise. Synthesia in the U.K. is taking a similar approach with AI video tools, aiming them specifically at the business market for the building of training and customer support video content.

The Rise of Perplexity

Perplexity’s tools are not just limited to search; they also offer other features such as recommendations and answers. With its recent fundraises and high valuation, it is clear that investors believe in the company’s vision for the future of AI-powered search.

Industry Impact

The rise of Perplexity and similar startups has significant implications for the industry as a whole. As AI becomes increasingly integrated into our daily lives, companies like Perplexity are leading the charge to provide innovative solutions that meet the growing demand for AI-powered tools.

Conclusion

Perplexity’s recent fundraiser is just another milestone in its journey towards becoming a leader in the field of AI search engine technology. With its commitment to providing high-quality AI-powered tools and its focus on enterprise and search, it’s clear that this startup has what it takes to make a lasting impact on the industry.

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