Perplexity’s Meteoric Rise: Can This AI Search Challenger Outrun Google?

The global artificial intelligence race isn’t just about algorithms anymore—it’s about ambition, speed, and scale. And right now, one of the most watched players in this race is Perplexity, the three-year-old AI startup that has been making waves for reimagining what search could be in the age of generative AI.

Once viewed as a niche challenger to Google, Perplexity is no longer a fringe name. In fact, the company just closed another $100 million in funding, bumping its valuation up to a staggering $18 billion—a sharp leap from $14 billion just months ago. For context, Perplexity’s valuation stood at only $500 million at the beginning of last year. That's a 36x jump in under 18 months.

If there was ever a poster child for the AI boom, Perplexity is fast becoming it.

Preplexity Funding: Not Just Hype—There’s Real Traction

The Financial Times, which first reported the development, noted that Perplexity had originally set its sights on an $18 billion valuation during its $500 million funding round in May, but met with investor hesitation. Interestingly, it was after the round closed that new investors came knocking—ready to buy in at the same lofty valuation.

The renewed interest from investors isn’t without reason. According to sources cited by FT, the company’s annualised revenue run-rate has exploded from $35 million in August 2023 to $150 million this month. That’s more than a 4x jump in just under a year—an uncommon trajectory even by Silicon Valley’s blitz-scaling standards.

A New Contender in the Search Space? 

At its core, Perplexity is attempting what very few have dared—taking on Google in its own turf: Search.

While OpenAI focuses on assistants and Meta plays its cards in open-source LLMs, Perplexity is betting that the future of search won’t be about indexing pages but answering queries contextually, like a conversation. Think ChatGPT meets Google—but faster, more direct, and sometimes even more accurate.

It’s this bet that has caught the attention of not just venture capitalists, but also power players like Nvidia, SoftBank’s Vision Fund 2, NEA, and IVP, who have all backed the company.

The Bigger Picture: A War for AI Supremacy

Perplexity’s rise mirrors the larger shifts in the AI landscape, where valuation, talent, and strategic positioning are becoming weapons in a high-stakes global game.

Just look at the numbers and moves:

Meta reportedly tried to buy Thinking Machine Lab and Safe Superintelligence—both started by former OpenAI researchers—before eventually investing nearly $15 billion for a 49% stake in Scale AI.

Google, too, spent $2.4 billion recently just to hire the core team behind Windsurf, a coding startup.

These moves point to an aggressive talent war, where big tech is no longer just buying startups—they’re acquiring mindshare and capabilities at lightning speed.

For Indian startups watching the global AI space, Perplexity’s journey is a powerful reminder: you don’t have to be a giant to disrupt a giant. In just three years, it has redefined its category, attracted top-tier capital, and forced the world’s largest tech companies to take notice.

It also reinforces the importance of clear positioning, bold bets, and building at the speed of execution. With India's GenAI ecosystem slowly warming up—with players like Sarvam AI and BharatGPT making early moves—there’s much to learn from Perplexity’s playbook.

The question now is: Can Perplexity sustain its momentum—and one day truly rival Google? If the current numbers are anything to go by, the search has just begun.