When Both Apple And Facebook Are Trying To Buy You, The Best Thing To Do Is ........ Go Raise Money

 

Reports indicate that Apple and Meta (formerly Facebook) have shown interest in acquiring Perplexity AI, a San Francisco-based startup valued at $14 billion, known for its AI-powered conversational search engine. According to Bloomberg, Apple executives, including Adrian Perica (head of mergers and acquisitions) and Eddy Cue (services chief), have held internal discussions about a potential bid for Perplexity to bolster Apple's AI capabilities, particularly for Siri and Safari, as a strategic move to reduce reliance on Google amid antitrust scrutiny. These talks are in early stages, and no formal offer has been made to Perplexity, which stated it has "no knowledge of any current or future M&A discussions."

Similarly, Bloomberg and other sources report that Meta Platforms attempted to acquire Perplexity earlier in 2025 but failed to reach an agreement, opting instead to invest $14.3 billion for a 49% stake in Scale AI. Meta's interest was driven by a desire to integrate advanced conversational AI into platforms like Facebook, Instagram, and WhatsApp. While both tech giants have explored acquiring Perplexity, no deal has been confirmed, and discussions with Apple remain preliminary. Perplexity’s rising popularity, with 780 million monthly queries and a 20% monthly growth rate, makes it an attractive target, but the company is also in talks with Samsung for potential integration, which could complicate acquisition efforts. The information suggests interest from both companies, but without conclusive evidence of active, ongoing negotiations, the situation remains speculative. Always consider that such reports could be influenced by market strategies or leaks to boost Perplexity’s valuation or negotiating power, as some X posts suggest.

Perplexity AI, valued at $14 billion and boasting 780 million monthly queries with 20% month-over-month growth, is at a pivotal moment. With Apple and Meta reportedly eyeing acquisition, the temptation to sell might seem strong—cash out, integrate with a tech giant, and leverage their resources. However, staying independent and raising capital to fuel rapid expansion is the smarter play. Here’s why Perplexity should resist acquisition and instead pursue strategic partnerships, like Google’s early deal with Yahoo, to maximize its long-term potential. 1. Retain Control and Capture More Value

Selling to Apple or Meta risks diluting Perplexity’s vision and autonomy. Acquisitions often lead to integration challenges—cultural clashes, product pivots, or even shelving core innovations to fit the acquirer’s ecosystem. Apple might fold Perplexity into Siri or Safari, while Meta could repurpose it for social platforms, potentially stifling its broader potential as a standalone AI search engine. Google’s early days offer a lesson: instead of selling to Yahoo in 1998, Google raised $25 million from Sequoia and Kleiner Perkins, retained control, and built a $2 trillion empire. Perplexity, with its conversational AI and growing user base, is positioned to dominate the AI-driven search market, which could be worth hundreds of billions. Selling now would cap its upside. Raising capital—say, another $500 million to $1 billion—would allow Perplexity to scale its infrastructure, hire top talent, and accelerate R&D. This path preserves its ability to dictate terms and capture the full value of its growth trajectory, rather than handing it to a tech giant for a fraction of future potential. 2. Strategic Partnerships Over Acquisition

Perplexity can emulate Google’s 2001 deal with Yahoo, where Google became Yahoo’s default search engine for a significant payment, gaining massive exposure without surrendering ownership. Perplexity could strike similar deals with Apple and other players like Yahoo (now under Apollo Global Management) or Samsung, which is already in talks for integration. For example:

- Apple: License Perplexity’s AI to enhance Siri’s conversational abilities or power a smarter Safari search, in exchange for a hefty licensing fee or revenue share. This gives Apple the AI boost it seeks without Perplexity losing its independence. - Yahoo: Partner to integrate Perplexity’s search capabilities into Yahoo’s platform, which still attracts millions of users. This could include exclusive features or co-branded AI tools, providing Perplexity with scale and revenue. Such deals would give Perplexity access to massive user bases, distribution channels, and cash flow, all while keeping its brand and technology intact. Google’s Yahoo partnership didn’t just bring revenue—it validated its technology and drove adoption, paving the way for its dominance. Perplexity could similarly use partnerships to accelerate growth and market penetration. 3. The AI Search Market Is Still Wide Open

The search market is ripe for disruption. Google’s dominance is under pressure from antitrust lawsuits and user dissatisfaction with ad-heavy results. Perplexity’s conversational, answer-focused AI search is gaining traction, with 250 million monthly active users and a model that prioritizes accuracy over ads. This is a rare opportunity to challenge incumbents, but acquisitions often derail disruptors. Look at DeepMind: acquired by Google, it became a cog in Alphabet’s machine rather than a standalone leader. Perplexity, by staying independent, can double down on product innovation—expanding into enterprise search, verticals like healthcare or finance, or even multimodal AI (text, image, video)—to capture a larger share of the $200 billion global search market. Raising capital would fund aggressive expansion: more servers to handle query volume, localized models for international markets, and marketing to steal share from Google and Bing. A partnership-driven approach, like Google’s with Yahoo, avoids the risks of acquisition while providing the scale needed to compete. 4. Leverage Competitive Interest for Better Terms

Apple and Meta’s interest signals Perplexity’s strength, but it also gives the startup leverage. By playing the two against each other, Perplexity could secure better partnership terms or higher valuations in funding rounds. Venture capitalists, seeing the bidding war, would likely pour money into Perplexity to keep it independent, betting on its potential to rival Google. For instance, a new funding round at a $20 billion valuation could provide the war chest needed to scale without ceding control. X posts have speculated that Perplexity’s talks with Samsung and others could be a strategic move to boost its valuation—staying independent maximizes this leverage. 5. Avoid Antitrust and Integration Risks

Both Apple and Meta face antitrust scrutiny. Apple’s $20 billion Google search deal is under fire in the DOJ’s antitrust case, and acquiring Perplexity could draw further regulatory heat, potentially delaying or derailing the deal. Meta’s acquisition attempts, like its failed bid for Perplexity, also face skepticism due to its history of swallowing competitors (e.g., Instagram, WhatsApp). An acquisition could trap Perplexity in legal limbo or force it to compromise its product to meet regulatory demands. Partnerships, on the other hand, are less likely to trigger antitrust concerns and allow Perplexity to maintain flexibility. Counterargument: Why Sell?

One could argue that selling to Apple or Meta offers immediate financial security, access to their vast resources, and integration into ecosystems with billions of users. Apple’s 2 billion active devices or Meta’s 3 billion monthly active users could supercharge Perplexity’s reach. But this assumes smooth integration, which is rare. Acquired startups often lose their edge—look at Siri post-acquisition or WhatsApp’s privacy controversies under Meta. The short-term gain of a $14 billion payout pales compared to the potential of building a $100 billion+ independent company in a market poised for transformation. Conclusion

Perplexity should raise capital, double down on expansion, and pursue strategic partnerships with Apple, Yahoo, Samsung, or others to gain scale and revenue without sacrificing control. Google’s Yahoo deal in 2001 shows how a young company can leverage partnerships to catapult growth while staying independent. With the AI search market heating up and Perplexity’s momentum surging, now is the time to bet on itself, not cash out.

When Both Apple And Facebook Are Trying To Buy You, The Best Thing To Do Is ........ Go Raise Money https://t.co/gKbhSGjOZF @perplexity_ai @AravSrinivas @denisyarats @_Faraz

— Paramendra Kumar Bhagat (@paramendra) June 28, 2025