According to a source familiar with the matter, Perplexity AI is in discussions to raise funds at an $18 billion valuation. The startup, backed by Nvidia, aims to expand its operations to meet the increasing demand for its search tools. This new valuation marks a significant increase from the previously reported $9 billion in November.

Perplexity, an artificial intelligence company, offers search capabilities similar to ChatGPT and Google's Gemini. Supported by prominent figures like Jeff Bezos from Amazon.com and SoftBank Group from Japan, the firm is considering raising between $500 million and $1 billion in the funding round.

The surge in interest from investors can be attributed to the growing popularity of chatbots and AI agents that can perform tasks on behalf of users. To compete effectively with Google's Gemini and OpenAI's ChatGPT supported by Microsoft, Perplexity has been enhancing its platform features. Recently, the company introduced a new AI-powered web browser named Comet, capable of understanding and executing complex queries beyond just retrieving information.

Perplexity's Deep Research feature is designed to provide in-depth reports by analyzing multiple sources and conducting extensive research. While the news of the increased valuation was first reported by Bloomberg, Perplexity remains one of the key players challenging established search engine giants like Google.

However, the startup has faced allegations from media outlets like News Corp-owned publications, Forbes, and Wired, accusing it of content plagiarism. In response, Perplexity has initiated a publisher partnership program to collaborate with news organizations. In a related development, OpenAI recently completed a funding round of $6.6 billion, potentially valuing the company at $157 billion, solidifying its status as one of the most valuable private enterprises globally.

The information was reported by Akash Sriram, Jaspreet Singh, and Kritika Lamba in Bengaluru.