Nobody was supposed to compete with Google in search. That was the conventional wisdom for two decades. Google had the data, the infrastructure, the brand recognition, and the distribution. Search was a solved problem. The moat was infinite. Then Perplexity showed up and said: what if search wasn't about links? Founded in August 2022 by four engineers with backgrounds at Google, Meta, and Databricks — Aravind Srinivas, Denis Yarats, Johnny Ho, and Andy Konwinski — Perplexity launched its search engine on December 7, 2022. The premise was radical in its simplicity: instead of giving you ten blue links and making you click through to find the answer, just give you the answer. With citations. In plain language. Three years later, Perplexity is valued at $14 billion, processes 30 million queries daily, and has the audacity to bid $34.5 billion for Google Chrome. Whether they can actually take down Google is debatable. That they've forced Google to fundamentally rethink its core product is not. ## The Growth Numbers Are Real Let's start with the trajectory, because it's the kind of growth curve that makes VCs physically tremble. February 2023: 2 million unique visitors. Just two million. That's a rounding error for Google. Fast forward to May 2025: 780 million queries in a single month, growing at more than 20% month-over-month. During Bloomberg's Tech Summit, Srinivas casually dropped that number like it was a Tuesday. At that rate, they're at roughly 30 million queries per day. To be clear: Google processes over 8.5 billion queries per day. Perplexity's 30 million is 0.35% of that. In absolute terms, it's nothing. But growth rates matter more than current scale in the early innings of a platform shift. Google didn't overtake Yahoo by being bigger on day one. It overtook Yahoo by growing faster, for longer, because the product was fundamentally better at the thing people needed. The funding reflects the trajectory. April 2024: $165 million at a $1 billion valuation. June 2025: $500 million at $14 billion. September 2025: the valuation hit $20 billion. Investors include Jeff Bezos, Tobias Lütke (Shopify founder), Nat Friedman (former GitHub CEO), NVIDIA, and Databricks. And then there's the Chrome bid. In August 2025, with a straight face, Perplexity offered $34.5 billion to buy Chrome from Google. The context: a federal judge had found Google guilty of maintaining an illegal search monopoly, and one proposed remedy was forcing Google to sell Chrome to break the distribution lock-in. Perplexity's bid was bold, probably unrealistic, and entirely in character for a company that's built its brand on audacity. ## Why Perplexity Works I use Perplexity daily. I also use Google daily. Here's the honest comparison. Perplexity is better when you want an answer. Not a list of websites that might contain the answer. An actual, synthesized, cited answer. "How does CRISPR-Cas9 work and what's the latest on base editing?" — Perplexity gives you a coherent, referenced explanation. Google gives you a Wikipedia link, three sponsored results, and a "People also ask" section that answers questions you didn't have. For research queries — the kind where you'd normally open five tabs and synthesize information yourself — Perplexity saves genuine time. Its Pro tier lets you choose between backend models (GPT-5, Claude 4.0, Gemini Pro 3, Grok 4, and their own Sonar model based on Llama 3.3), which means you're getting frontier-quality answers regardless of which lab is leading on any given benchmark. Perplexity also built a search API that gives developers programmatic access to its search infrastructure. The SDK, evaluation framework, and documentation dropped in September 2025. This matters because it creates an ecosystem beyond the consumer product. If developers build on Perplexity's search, the company becomes infrastructure, not just an app. Then there are the commerce features. In November 2024, Perplexity launched a Shopping Hub — an AI-powered product recommendation and purchasing platform backed by Amazon and NVIDIA. In October 2024, they added finance features: real-time stock quotes, company earnings data, and peer comparisons. They're expanding from "answer engine" to "do everything engine." Google is still better for navigational queries ("take me to the NYT website"), local results ("best pizza near me"), and anything where you actually want to browse options rather than get a definitive answer. Google Maps integration, local business reviews, and shopping comparison are all areas where Google's data advantage is insurmountable. ## Google's Response: AI Overviews Google's response to Perplexity has been AI Overviews — AI-generated answer summaries that appear at the top of search results before the traditional blue links. The product launched broadly in 2024 and has been expanding ever since. It does exactly what Perplexity does: synthesizes information from multiple sources and presents it as a coherent answer. The difference is that it sits on top of Google's existing search infrastructure, with all the quality signals, freshness data, and knowledge graph information that Google has spent 25 years building. This is Google's natural defensive move. If the threat is "AI search gives better answers than links," then Google makes its links give AI answers too. The moat around search isn't just the algorithm — it's the default placement on billions of devices, the integration with Chrome, Android, and iOS, and the muscle memory of 4 billion people who type "google" into their browser bar every day. But AI Overviews create a cannibalization problem. Every AI-generated answer that satisfies a user at the top of the page is a user who doesn't click through to a website. Fewer clicks means less advertising value. Google's entire business model is built on the gap between your question and the answer — the gap that makes you click links. AI Overviews close that gap. Google's 2025 advertising revenue was approximately $265 billion. Even a small percentage reduction in click-through rates translates to billions in lost revenue. This is the innovator's dilemma in its purest form: the right product decision for users (give them answers directly) is the wrong business decision for the company (fewer clicks means less ad revenue). ## The Moat Analysis Can Perplexity actually win? Let's be honest about the competitive dynamics. **Google's moats:** - Default search on 4+ billion devices - 25 years of search quality signals - Knowledge Graph with billions of entities - Maps, Shopping, News, and vertical integration - Chrome browser with 65%+ market share - Android with 70%+ mobile market share - $265 billion in annual search advertising revenue to fund anything **Perplexity's advantages:** - Better answer quality for complex queries (right now) - No advertising cannibalization problem - Agility — ships features faster than Google - Multiple model backends (not locked to one provider) - Growing developer API ecosystem - Brand association with "the future of search" The honest assessment: Perplexity can't kill Google. The distribution advantage is too large, the moats too deep, the switching costs too high for most users. What Perplexity can do is carve out a meaningful segment of the search market — power users, researchers, developers, and knowledge workers who value answer quality over familiarity. Is that a $14 billion business? Maybe. Google Search generates $265 billion in annual revenue. If Perplexity captures even 2-3% of search advertising's total addressable market through its own monetization efforts, that's $5-8 billion in potential revenue. At typical SaaS multiples, a $14 billion valuation starts looking defensible. ## The Legal Cloud There's a shadow over Perplexity that's worth acknowledging: it's facing serious legal and ethical scrutiny. The BBC, Dow Jones, and The New York Times have all raised copyright and content concerns. Wired and Cloudflare separately found that Perplexity uses undisclosed web crawlers with spoofed user-agent strings to scrape websites that explicitly prohibit scraping. That's not a good look for a company positioning itself as a trustworthy alternative to Google. Perplexity responded with a publishers' revenue-sharing program in July 2024, but the underlying tension remains. When your product synthesizes content from other websites and presents it as a unified answer, the publishers whose content you're synthesizing have a legitimate grievance about lost traffic and attribution. This is the same fundamental tension as the NYT v. OpenAI case. If AI search products can synthesize publisher content and satisfy user queries without sending traffic to the original sources, the economic model that funds journalism collapses. Perplexity adds citations, which helps, but a citation at the bottom of a comprehensive answer doesn't drive the same traffic as a Google link that forces users to visit the site. ## My Take Perplexity won't replace Google. But it's already changed Google. AI Overviews exist because Perplexity proved that answer-first search works. Google's scramble to add AI to every search result is a direct response to Perplexity's growth. That alone makes Perplexity one of the most consequential startups of the decade. Not because it'll win the search war, but because it proved the war could be fought at all. For twenty years, everyone assumed search was over. Perplexity showed it was just getting interesting. The question isn't whether Perplexity survives. It's whether "search" as a category survives the transition from "find links" to "get answers." That transition is happening whether Google leads it or Perplexity forces it. The 52-person startup didn't start the fire. But they lit the match.