Perplexity AI, the startup that wants to “make Google obsolete”

When you’re voiced by Jeff Bezos and Jensen Huang, founders of Amazon and Nvidia, respectively, you might have ambition. Aravind Srinivas has no shortage of them. Perplexity AI’s CEO makes clear his desire to make Google “cheesy”. On Tuesday, the American startup officially completed its second fundraising of the year, worth $63 million. In January, she already collected 74 million. Between these two operations, its value doubled, reaching the symbolic mark of a billion. And the entrepreneur is set to capitalize on the enthusiasm generated in recent months by his online search solution powered by generative artificial intelligence. In accordance with Techcrunchit is already in talks for a next round of funding of at least 250 million, based on a potential valuation of 3 billion.

Structured answer – Founded in 2022, Perplexity has developed a conversational robot that at first glance looks very similar to ChatGPT. But his tool is different in the way it works: it is not based on the corpus of texts that was used to train it, but searches dozens of web pages for an answer. This method should theoretically reduce the number of hallucinations of large language patterns. The service then displays structured text that links to multiple sources, rather than a long list of links or excerpts from small websites, as Google suggests. He then suggests other questions to explore the topic further. “Future”, – says Aravind Srinivas. The startup now has ten million monthly active users, including Jensen Huang, who uses it. “almost every day”.

Google is resisting – In addition to these initial successes, Confusion will have to fight ingrained habits. Despite adding answers provided by ChatGPT to the Bing search engine, Microsoft has hardly made any progress against Google. This will be all the more challenging because traditional systems are still much better suited for large volume requests, such as navigating to a website, checking the weather, or searching for a restaurant. Google also offers a number of additional services that make it even more useful to Internet users. First of all, the Mountain View giant is not sitting idle. Since last year, the company has been testing several generative AI integrations inside its engine, including the response generated by the Gemini model over links.

Economic model – Aravind Srinivas, however, believes it has an advantage: a lack of historical activity in maintaining sponsored links, which partly explains why Google has been slow to implement AI on a large scale. But Perplexity will have to refine its business case, and the operating costs of AI are very high. The startup already offers a $20 per month subscription that allows for more advanced searches and different language models. She claims annual recurring revenue of $20 million, which translates to less than 100,000 subscribers. On Tuesday, it announced the launch of a paid offering for businesses, selling for $40 per month. The possibility of adding advertising to the free version is also being considered.

For further:
– Generative AI could push Google to change its business model.
– With the help of Microsoft, OpenAI wants to compete with Google