Perplexity: Redefining Search

By early 2025, Perplexity had rapidly evolved from a modest startup into a popular "answer engine" valued at $9 billion. The company had boldly positioned itself as the disruptor to Google aiming to redefine search for the AI age. Through novel AI orchestration—combining custom-built indexes, real-time retrieval systems, and language models—Perplexity delivered answers to complex queries, challenging Google's dominance in traditional search. The company differentiated itself by emphasizing user-centricity, speed, and quality, intentionally foregoing advertising-based monetization. Deep Research, Pro Search, and Comet (an AI-native web browser) had helped it make inroads into both consumer and enterprise segments globally. Yet, as Perplexity scaled, the company faced tough choices in preserving its ad-free, user-centric approach versus exploring monetization strategies, such as advertising. Maintaining user trust and platform simplicity was becoming increasingly complex in the fiercely competitive AI search market. Additionally, high execution velocity and expanding into enterprise markets required significant investment in security and infrastructure, intensifying the pressure to stay ahead of competitors like OpenAI and Google. The case illustrates the tension between maintaining a trusted, unbiased product experience and pursuing monetization strategies such as advertising. It emphasizes the importance of aligning revenue models with core brand promises to sustain long-term user trust and growth.