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Perplexity AI, one of the fastest-rising names in the global AI search landscape, found itself at the center of intense scrutiny during the recent Cerebral Valley AI Conference in San Francisco. The company has been celebrated for its ambitious goal of redefining online search through conversational intelligence.
The conference outcome sparked widespread discussion after more than 300 founders and investors ranked Perplexity as the “most likely to fail” among AI unicorns. This sudden judgment raised questions on the company’s valuation, business trajectory and long-term sustainability.
Industry insiders highlighted Perplexity’s breakneck fundraising streak as a warning sign. Its valuation reportedly increased from approximately $14 billion to nearly $50 billion in a short span, sparking speculation about an AI bubble.
Several investors at the conference compared the situation to the early dot-com era, warning that not all high-flying AI startups will endure long term.
Perplexity’s response to the poll carried a mix of humor and deflection. A company spokesperson labeled the gathering a “judgmental valley conference,” trying to deflect the criticism. But the comment also revealed clear friction between Perplexity and the startup community.
While the company projects confidence, the tone of the event signaled a shift in investor sentiment and a deeper evaluation of AI companies claiming rapid breakthroughs.
Beyond investor doubts, Perplexity is undergoing a storm of legal and ethical challenges. The company is accused of collecting unauthorized content, with BBC reportedly considering legal action. Moreover, trademark disputes and accuracy issues have added more pressure; some online users have claimed that the search results were either misleading or inaccurate.
Aravind Srinivas, the CEO of the company, also expressed concerns about the emotional manipulation in AI companions' tools, which points towards the need for a thorough examination of the company's approach to regulation and ethics.
The verdict from the conference appears to represent broader anxiety across the tech ecosystem. Perplexity is increasingly seen as a symbol of the rapid escalation in AI valuations, where excitement may be outpacing proven results.
Even OpenAI placed second in the same informal poll, suggesting that investor doubt now extends to the biggest players. Many insiders believe the industry may soon experience a correction, separating sustainable innovation from speculative enthusiasm.
Also Read: Is Perplexity's AI Browser Comet too Smart to Replace Human Workforce?
Perplexity has undeniably pushed bold ideas in conversational search and real-time answer engines. But critics argue the company’s business foundations don't match the hype. The company's change in fundraising, along with aggressive positioning, has increased both visibility and vulnerability when compared to the previous models.
For long-term credibility, Perplexity must strengthen trust, improve transparency, and show consistent performance. Its future now depends on turning hype into genuinely durable innovation.
