Perplexity's blockbuster investor demand shows just how wild the AI bubble has become (www.businessinsider.com)

Perplexity — the three-year-old AI search challenger to Google — has become a poster child for the frothy AI fundraising market, repeatedly attracting offers that pushed its valuation from about $14B to $20B within months and, according to some sources, as high as $50B. The company reported over $150M in annual recurring revenue by mid‑2025 and ranks high on secondary-market interest, yet its revenue-to-valuation multiple comfortably exceeds 100x. Back-to-back markups, heavy investor FOMO driven by mega-rounds at OpenAI and Anthropic, and Perplexity’s aggressive public moves (bids to acquire Chrome and interest in TikTok) have amplified attention and debate. Technically and strategically, Perplexity is scaling both consumer and enterprise plays: a free and $20/month consumer tier, a newly free AI browser (Comet) after pausing new ad deals, a shopping feature, and enterprise integrations with Zoom and Nvidia. Those product pivots and rapid fundraising reshape how investors benchmark AI value — rewarding future potential over current fundamentals — but also create tension: high markups complicate follow-on funding, reduce realistic exit or M&A probabilities at those prices, and push later-stage firms into defensive checks to preserve ownership. The story illustrates a broader market implication: AI is rewriting valuation norms, accelerating capital flows, and raising bubble-risk conversations as investors weigh transformative upside against stretched multiples.