Perplexity, an artificial intelligence (AI) search company backed by Amazon's Jeff Bezos, is reportedly engaged in discussions to significantly increase its valuation as it seeks additional funding. According to sources cited by the Wall Street Journal, the company is aiming to more than double its valuation to at least $8 billion through a new funding round where it hopes to secure approximately $500 million.
This development follows a previous funding round during the summer, in which Perplexity was valued at $3 billion after receiving investment from SoftBank. The rapid valuation rise, should it happen under these terms, reflects growing interest and investment within the AI and technology sectors.
Perplexity offers an AI-driven web search service characterised by a chatbot-style interface, reportedly handling about 15 million queries daily and generating annual revenue of approximately $50 million. Despite its rising prominence, the company has faced challenges, particularly concerning its use of online content. The New York Times has reportedly issued a cease-and-desist letter to Perplexity, alleging unauthorised use of content from its site.
In response to these allegations, Perplexity has maintained that it respects the guidelines of robots.txt, a file used by websites to manage and restrict automated web crawlers. Perplexity asserts it does not scrape the content of any site that prohibits its bot through robots.txt. It also clarified that while users could previously prompt the AI to summarise specific URLs—even those restricted by robots.txt—the feature was used infrequently and has since been disabled due to misuse, wherein some users were reportedly breaching Perplexity's terms of service.
Additionally, Perplexity has noted that while it ensures its PerplexityBot adheres to the robots.txt framework, certain third-party crawlers employed in its search index had not consistently followed these restrictions. Steps have purportedly been taken to ensure compliance with robots.txt protocols.
The news of these fundraising efforts and the related legal wrangle with media companies comes amid a broader context of competition in the AI and search technology markets. Notably, OpenAI, a key player in this domain, recently raised a colossal $6.6 billion, giving it a valuation of $157 billion as it furthers its development in AI technologies such as ChatGPT, which similarly merges chatbot functionalities with search capabilities.
Perplexity's CEO, Aravind Srinivas, has expressed a desire to collaborate with publishers, stating he intends no antagonism towards them. However, as technology giants and newer entities like Perplexity continue to advance AI search capabilities, the delicate balance between innovation and intellectual property rights remains a point of contention in the industry. Attempts to reach Perplexity for further comment were not immediately successful.
Source: Noah Wire Services