AI Startup Perplexity Set to Reach $9 Billion Valuation

Perplexity, an artificial intelligence (AI)-powered search engine, is set to triple its valuation from a few months ago following its latest funding round.

The company is due to raise $500 million in its fourth funding round this year, according to a Tuesday (Nov. 5) report from The Wall Street Journal, which cited people familiar with the matter. This would value Perplexity at $9 billion. It started this year with a valuation of $520 million.

Its rapid growth highlights strong investor interest in its offerings, WSJ said, and marks it as one of the most valuable AI startups amid a new wave of generative AI technology.

Last month, Perplexity said it served over 100 million queries a week.

CEO Aravind Srinivas noted the statistics in an Oct. 25 post on X, and said the company’s next goal was to reach over a 100 million queries a day.

Perplexity, which provides answers to user queries based on information it gathers from the web, has been widely criticized by news companies for using their reporting without appropriate compensation.

Two News Corp-owned publishers — WSJ parent company Dow Jones and the New York Post — filed a copyright infringement lawsuit against Perplexity in October.

The publishers allege that the AI startup uses their copyrighted content to answer users’ questions, in some cases reproducing entire articles, and siphons off traffic that would otherwise have gone to the publishers’ sites.

“This suit is brought by news publishers who seek redress for Perplexity’s brazen scheme to compete for readers while simultaneously freeriding on the valuable content publishers produce,” the publishers said in their complaint, per an Oct. 21 WSJ report.

This lawsuit comes after Perplexity failed to respond to a letter that the publishers had sent in July outlining their concerns.

CEO Srinivas reportedly said Oct. 23 that he was surprised by the lawsuit and that he was interested in a “proper commercial discussion.”

“Srinivas said … that Perplexity wants to form revenue-sharing partnerships with news publishers, per the report,” PYMNTS said. “He said that he is not interested in signing licensing agreements with publishers, instead suggesting that the company would share advertising revenue with publishers.”

Perplexity will launch an advertising program in November, according to an Oct. 23 WSJ report.

Srinivas also said that Perplexity could give publishers access to chatbots that would respond to users’ queries on the publishers’ websites, using their content to provide answers, per the report.