Perplexity CEO: Google's Internal AI Models "Fourth or Fifth Best"

Aravind Srinivas, CEO of AI-powered answer engine Perplexity, recently asserted his company's superior innovation capabilities over tech giant Google. Srinivas stated that Google's internal AI models are merely "fourth or fifth best" at any given moment. This assessment suggests an unprecedented advantage for startups like Perplexity, which can access and leverage cutting-edge AI technologies that surpass Google's in-house developments.

"Google had maybe a fourth or fifth best models at any moment. So as a startup outside Google, you had access to AI that was better than what Google internally had, which was unprecedented." — Aravind Srinivas

Perplexity differentiates itself by operating as an answer engine, providing direct, sourced responses to user queries rather than a list of links. This approach, rooted in Retrieval-Augmented Generation (RAG), emphasizes factual grounding by citing information from multiple web sources. The company's core philosophy aims to deliver accurate and neutral information, contrasting with traditional search models.

Srinivas attributes Google's perceived lag in AI innovation to its deeply entrenched advertising-driven business model. He argues that Google's reliance on ad revenue disincentivizes a full transition to AI-first answers, as direct answers bypass the need for users to click on revenue-generating links. This "innovator's dilemma" creates a strategic opening for agile startups.

Founded in August 2022, Perplexity has rapidly grown to over 10 million users, with more than a million in India. The company recently secured $73.6 million in Series B funding, valuing it at $520 million. Notable investors include Amazon founder Jeff Bezos, Nvidia, Institutional Venture Partners, and Shopify CEO Tobi Lutke, underscoring significant industry confidence in its disruptive potential.

Perplexity plans to expand its monetization beyond its current subscription model to include advertising, enterprise solutions, and API access, with a commitment to not compromise answer quality for revenue. Srinivas envisions Perplexity as a "knowledge discovery engine," guiding users to deeper understanding and empowering them to be more truth-seeking. This long-term vision positions the company as a key player in the evolving landscape of information access.