Perplexity, an artificial intelligence company, is set to raise $500 million in a new funding round at a valuation of about $9 billion.
Reuters reported, citing people familiar with the matter, that Institutional Venture Partners (IVP), a venture capital firm that also holds a seat in the AI startup, is pioneering a $500 million funding.
In January, Perplexity was able to raise around $73.6 million, in a funding round also led by IVP. At the time, the infusion raised the value of the company to $520 million.
According to CNBC, the company was valued at around $3 billion in June. But with the new fundraising, the figure could change exponentially.
Perplexity is among the many AI startups that would like to have a bite of the booming AI market, which at present is being dominated by OpenAI, the force behind the worldwide phenomenon ChatGPT.
Perplexity begun the year with a roughly $500 million valuation. Since then, the company raised funds from three rounds this year amid continued investor interest in generative AI.
Founded in 2022, Perplexity was embroiled in controversies, crossing swords with a number of known news publishers.
It was only in October when the company received a "cease and desist" order coming from the New York Times. The latter was claiming that the startup was using its content for generative AI purposes, hence, the order for it to stop doing so.
The complaint made by New York Times was not the first time that such allegations were made against the Nvidia-backed AI company. Before NYT, it was also accused by Forbes and Wired, both of which claimed that the company plagiarized their content. Since then, there was already a revenue-sharing program that was put forward in response to the concerns of a number of publishers.
The success of ChatGPT ushered investors to put their money behind AI startups. However, huge funding that could run in billions is needed in building large language models, the backbone behind the technology.
Just last month, OpenAI closed around $6.6 billion. This paved the way for the company's valuation to reach $157 billion. It also cemented its position as among the most valuable companies in the world.
OpenAI has also entered early talks with California authorities regarding a transition to a for-profit business model. The shift would represent a significant change in the governance structure for the AI pioneer.
Perplexity is one of the leading firms gunning to make a mark in the search engine market, which at present is dominated by Google. The Amazon and Nvidia-backed company provide information to users by searching the internet.
