Bezos Backs AI Startup Perplexity to Challenge Google's Dominance
Jeff Bezos has invested in Perplexity, an AI-powered startup valued at $520 million, aiming to challenge Google's dominance in web search. Perplexity utilizes OpenAI's GPT technology to provide direct text responses to user queries, distinguishing itself from traditional search engines that offer website links.
Summary
Investment and Valuation: Jeff Bezos, through his Expeditions Fund, along with other tech executives and venture capitalists, contributed to a $73.6 million Series B funding round for Perplexity. This investment values the startup at $520 million.
Perplexity's Unique Approach: Unlike conventional search engines that return lists of website links, Perplexity uses a chatbot-style interface powered by OpenAI's GPT technology. It generates direct text responses to queries, sourcing information from various online sources.
Product Development: Perplexity's "answer engine" is designed to directly respond to user inquiries. A more advanced version of their search engine, utilizing GPT-4, is available for a monthly subscription of $20.
User Adoption and Growth: As of November 2023, Perplexity's website and mobile app have attracted 10 million monthly users, with 53 million visits in that month alone, a significant increase from 2.2 million in December 2022.
Market Potential and Challenges: Despite its rapid growth and innovative approach, Perplexity faces the challenge of competing with Google, which holds a 90% market share in online search and a $1.74 trillion market cap. Perplexity's smaller team size and resources compared to Google's vast infrastructure could be a significant hurdle.
Bezos' Involvement and AI Investments: Bezos' interest in AI is evident, as Amazon has recently committed billions to AI initiatives, including a $4 billion investment in Anthropic, a generative AI startup. His involvement in Perplexity signals a growing interest in AI-driven solutions in various sectors.
Perplexity's Team and Background: Aravind Srinivas, CEO of Perplexity, has a background in AI and previously worked as a research scientist at OpenAI. The company's team is based in San Francisco and comprises less than 40 members.
Strategic Investments: Perplexity has also received funding from other significant investors, including NVIDIA, and has raised a total of $100 million to date.
Future Prospects: While Perplexity has not yet been listed on a stock exchange, and its plans for an IPO are unclear, the startup's innovative approach to search and substantial financial backing position it as a potential disruptor in the search engine market.