A search startup raised $26 million recently to supply an AI-powered rival to Google.
Perplexity AI, which bills itself as a “conversational search engine,” closed a Series A funding round led by Recent Enterprise Associates, with participation from Databricks Ventures and angel investors including former GitHub CEO Nat Friedman and Meta chief scientist Yann LeCun. The fresh tranche comes as Perplexity reports that it had 10 million monthly visits and a couple of million unique visitors in February alone.
That’s a far cry from the estimated 89 billion visits Google had in May 2022. But Perplexity is betting heavily on its AI tech to set it other than the incumbents.
Perplexity was founded in 2022 by Aravind Srinivas, Denis Yarats, Johnny Ho and Andy Konwinski, engineers with backgrounds in back-end systems, AI and machine learning. Yarats was a staff machine learning engineer at Quora for several years before joining Meta as an AI research scientist, while Srinivas interned at DeepMind and Google and later joined OpenAI as an AI researcher. Ho worked as an engineer at Quora, then a quantitative trader on Wall Street, and Konwinski was among the many founding team at Databricks.
Unlike a typical search engine, Perplexity offers a chatbot-like interface that permits users to ask questions in natural language, to which its AI responds by citing sites and sources from around the net. Users can ask follow-up inquiries to dive deeper into a specific topic and Perplexity will respond based on the context of its earlier responses.
It’s not a latest concept. The AI-powered ChatGPT and Bing Chat, similarly, let users get answers to questions on any variety of topics by asking conversationally. But Perplexity’s founders claim that their tech performs higher, overall, in the case of accuracy. (Today’s chatbots are notorious for “hallucinating,” or simply plain making up, answers to questions.)
“We’ve built a first-of-its-kind conversational answer engine that’s grounded in providing accurate and relevant information through citations,” Srinivas said in a press release. “When people search online for answers to their questions, they’re presented with infinite lists of links that might be manipulated by advertisers and search engine marketing. Individuals are then tasked with sifting through those web sites and distilling the knowledge, much of which might not be accurate in the primary place. With Perplexity AI, we aspire to repair all of that.”
Image Credits: Perplexity AI
That’s an ambitious mission. But Perplexity is forging ahead, releasing an iOS app in recent days that introduces features like user sign-in for personalization, persistent search history and social sharing.
Srinivas says that the funds from the Series A will likely be put toward Perplexity’s growth and expansion plans, including “optimizing the appliance’s knowledge database.”
“This can be a first step in our mission of constructing the world’s most transparent information service and maximizing the knowledge and productivity of the typical consumer,” he added.
Perplexity is simply the newest startup within the generative AI space to draw outsize investor attention. Just last month, Character.ai, a personalised chatbot platform, closed a $150 million Series A at a $1 billion valuation. In line with a PitchBook report released in March, VCs have steadily increased their positions in generative AI, from $408 million in 2018 to $4.8 billion in 2021 to $4.5 billion in 2022.