Perplexity AI, a high-tech startup behind the fast-growing AI search engine, has secured $50 million for venture funds aimed at early-stage AI startups, CNBC reported, citing its filing with the U.S. Securities and Exchange Commission (SEC).
Confusion contributes to the fund, but most of the capital comes from outside investors, a source familiar with the issue said. The fund will be led by Kelly Graziadei and Joanna Lee Shevelenko, who previously ran early-stage investment firm F7 ventures. SEC filings starting in October show that Graziadei and Shevelenko are listed as general partners, Perplexity F7 Fund I, targeting $50 million.
“According to the US Stock Exchange filings from October, the Prplexity F7 fund I filed to raise $50 million. Graziadei and Shevelenko have been appointed as two general partners,” CNBC reported.
Since the surge in generation AI tools in late 2022, confusion has gained traction in the AI space. The company has established itself as a potential rival to Google as more users explore AI-powered searches. In November, TechStartups reported that the confusion was approaching raising $500 million at a $9 billion valuation.
The company is also taking bold moves beyond search. Last month, Confusion bids to merge with Tiktok US, a move to raise eyebrows as social platforms face possible regulatory actions in the US.
On the investment side, Prplexity sees an advantage in finding promising startups. With around 80,000 developers using the API, the company has insights that AI projects are gaining traction. That visibility can be advantageous when identifying potential investment opportunities.
The fund has been supported by Perplexity founders and investors, and some of the company’s contributions will appear in stock, sources said.
The rising of confusing AI
Searching for AI Assist has emerged as an important focus for investors. This is because it presents a potential challenge to Google’s advantages in how people access information online. Openai, which fired the AI Wave generated with ChatGpt in the second half of 2022, expanded to search with the introduction of SearchGpt last year. In response, Google expanded the “AI Overview” and directly provided users with a brief answer summary at the top of the search results.
Startups have skyrocketed from $500 million at the start of 2024 to about $9 billion by the end of the year. The company’s rapid growth was driven by surges investor interest in generating AI despite facing plagiarism accusations along the way.
The dramatic rise of Perplexity AI highlights a broader shift in consumer behavior and investor priorities as generative AI shapes the context of online search and information search.
Perplexity AI was founded in 2022 by Aravind Srinivas, Andy Konwinski, Denis Yarats, and Johnny Ho, and redefines search by providing direct answers to user questions. Competing with giants like Google and Openai, the company recently launched an iOS app to make AI-driven search engines more accessible to mobile users.
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