ChatGPT competitor Perplexity AI seeking to raise $500 million, eyes valuation of over $8 billion

ChatGPT competitor Perplexity AI, backed by Jeff Bezos, is reportedly in the process of raising significant funds to boost its valuation. According to a report by the Wall Street Journal, the AI firm is seeking to more than double its valuation to over $8 billion through a new fundraising round. Perplexity is reportedly aiming to secure around $500 million in this funding effort, as noted by sources familiar with the matter.

The report also added that the company, which has also received backing from Nvidia, is growing rapidly and is estimated to have an annualised revenue of around $50 million based on recent sales figures.

Perplexity AI is known for its powerful search tools, which allow users to ask questions and receive instant, detailed answers backed by sources and citations. The company utilises a variety of large language models (LLMs) to deliver these results, including OpenAI’s models and Meta’s open-source Llama model. This versatility enables Perplexity to sum up information efficiently and provide users with quick and reliable answers to their queries.

Perplexity AI has alsobeen at the centre of some controversy in recent months. In October, the startup received a “cease and desist” notice from the New York Times, which accused the company of using its content to train its generative AI tools without permission. This incident highlights the growing tension between AI companies and media outlets over the use of their content for artificial intelligence purposes.

This wasn't the first time Perplexity AI had faced such accusations. Other media organisations had previously claimed that the company plagiarised their content. However, in response to these concerns, Perplexity had introduced a revenue-sharing program aimed at compensating publishers whose material is used by its AI systems. This move was seen as an attempt to improve relations with content creators and address some of the ethical concerns surrounding AI’s use of proprietary information.