Perplexity, the AI-powered search engine startup, has crossed the $100 million mark in annualised revenue—an achievement it reached just 20 months after launching its premium subscription, Perplexity Pro. CEO Aravind Srinivas announced the milestone in a LinkedIn post, highlighting the company’s impressive 6.3x year-over-year growth. Despite this rapid expansion, Srinivas noted that Perplexity remains “highly under-monetised,” suggesting significant room for future revenue optimisation.
Perplexity has positioned itself as a direct competitor to traditional search engines, offering AI-generated answers instead of standard search results. The company operates on a freemium model, with a basic free tier and a $20-per-month Pro plan that unlocks additional features. For businesses, Perplexity provides an enterprise subscription at $40 per seat per month for companies with fewer than 250 employees.
According to media reports, developers can also integrate Perplexity’s in-house AI model, Sonar, via APIs. Built on Meta’s open-source Llama 3.3 70B, Sonar leverages Cerebras Inference, an AI engine that can generate up to 1,200 tokens per second. Perplexity recently expanded access to Sonar, allowing Pro users to set it as their default model on the platform.
As Perplexity cements its place in the AI landscape, media reports indicate that the company is in discussions to raise between $500 million and $1 billion in new funding. If successful, the fresh capital could push Perplexity’s valuation to a staggering $18 billion, double its last recorded valuation of $9 billion from December 2023, when it raised $500 million, Analytics India Magazine reported.
The startup has attracted high-profile backers, including NVIDIA, SoftBank Group, and Amazon founder Jeff Bezos, reflecting investor confidence in its AI-driven approach to search. Perplexity’s meteoric rise mirrors a broader trend in the AI sector, where startups are achieving remarkable growth with lean teams and aggressive scaling. AI-powered coding assistant Cursor recently hit $100 million in annual recurring revenue (ARR) just 21 months after launching, with its revenue surging from $1 million to $100 million in just 12 months—making it the fastest-growing SaaS company to date.