Perplexity, an artificial intelligence startup, is in discussions to raise its valuation to $8 billion or higher in its latest funding round, a significant increase from its previous valuation of $3 billion.
What Happened: The San Francisco-based company, which has seen its valuation triple in the past year, is looking to raise approximately $500 million in its fourth funding round, reported The Wall Street Journal on Sunday, citing people familiar with the matter. The funding would be a test of investor interest in high-growth AI startups.
Perplexity, founded two years ago and backed by Amazon.com Inc. founder Jeff Bezos, is a search-based chatbot that provides real-time information. The company’s annualized revenue is currently around $50 million, up from $10 million in March.
Despite its rapid growth, Perplexity has faced criticism from web publishers for using their content without permission. The New York Times has even sent a “cease and desist” notice to the startup.
Perplexity did not immediately respond to Benzinga‘s request for comment.
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Why It Matters: Perplexity has been making significant strides in the AI industry. In September, the company was reportedly in talks with top brands like Nike Inc. and Marriott International as it prepared to challenge Google’s dominance in the digital ads industry. In August, its revenue and usage skyrocketed after it entered into advertising.
Perplexity’s CEO, Aravind Srinivas, has been vocal about challenging the duopoly of Alphabet Inc GOOGL GOOG subsidiary Google and Meta Platforms Inc META in the search and advertising industry.
Perplexity is also in discussions with major brands like Nike Inc. and Marriott International to develop a “sponsored” question system, aiming to disrupt Google’s auction-based ads model.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
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