Is the advancement of an AI-driven search engine posing a threat to Google's dominance?
The Cali-based search engine Perplexity, fueled by AI, has seen a massive surge in user queries, hitting a whopping $3 billion market value. Now, the AI startup is on the hunt for a viable business model. Dmitry Shevelenko, Chief Business Officer, shares his thoughts on potential strategies.
Given that Perplexity mirrors Google's services, do you envision Perplexity as a competitor in the same league?
Dmitry Shevelenko: While they share some commonalities, Perplexity stands out with notable differences. For instance, the average query on Perplexity consists of ten words. Users pose intricate, multilayered questions that would seem illogical on a conventional search engine.
Doesn't this also imply that Perplexity caters to a niche audience of individuals who enjoy crafting lengthy sentences and reading in-depth content? Aren't the majority of users too lazy for that?
Questioning is an inherent human trait. Conversations and debates are driven by this interactive process. We aim to make it as effortless as possible to engage with Perplexity. It's incredibly swift, which is vital. Moreover, users have the option to dictate their queries and listen to the responses. I also believe that complex queries are more likely when users discover valuable insights.
Beyond offering a functional search engine, how does Perplexity generate revenue?
We have three versions of the software: the gratis online platform, where anyone can ask questions. The Pro version, offering a more comprehensive search, which delivers more detailed responses. Lastly, the professional corporate version, which businesses can use to grant employees access.
Given that a paid subscription alone may not be sufficient to drive exponential growth, what role does advertising play in Perplexity's business model?
We'll debut ads in the upcoming US quarter. Historically, free online services attract the majority of users. To thrive, we need to monetize this traffic. However, we approach advertising differently from traditional platforms.
What distinguishes your approach to advertising?
Sponsored queries will be part of our strategy. Under Perplexity's answers, relevant follow-up questions will appear along with sponsored queries. Yet, users will receive a genuine Perplexity response. Manipulating answers will not be tolerated.
Aren't Perplexity's strengths currently centered on providing genuine responses without the need to click on external links?
We aim to keep users engaged by encouraging them to ask more questions. We've no intention of pushing them towards other websites or losing our user base.
Check out the latest episode of "The Hour Zero"
· Examining the growth trajectory of Perplexity queries in Germany
· How Perplexity got its name
· Which German companies Perplexity collaborates with
All episodes available directly on RTL, Apple, or Spotify*.
The surge in user queries and the $3 billion market value of Perplexity highlight the health of The economy in the tech sector. With its unique features and catering to a niche audience, Perplexity's revenue strategies will be crucial in maintaining its trajectory in The economy.
