Conference Vote and Investor Concerns
Perplexity AI was recently voted the startup “most likely to fail” during the Cerebral Valley AI Conference held in San Francisco last week.
More than 300 founders, investors, and operators participated in the ranking, placing the rapidly expanding answer-engine company at the top of a list of high-valuation AI firms perceived as facing the greatest risk. OpenAI followed in second place.
The poll was organised by independent journalist Eric Newcomer and conducted during a private session. It quickly became the most talked-about result of the entire event.
According to attendees, scepticism stems from Perplexity’s surging valuation and its aggressive expansion into new markets without presenting a business model that investors feel is strong or defensible.
The company’s current valuation is around $20 billion, a figure reached after its September 2025 funding round in which it secured $200 million from major investors.
Although Perplexity positions itself as a next-generation alternative to traditional search engines, several investors argued that the firm has not yet demonstrated sustainable revenue generation or a clear advantage over larger AI competitors.
Recently, the company introduced upgrades to its Comet Assistant, including faster responses, improved accuracy, and stronger privacy features such as a new Snapshot tool.
Legal Pressure, Market Risks, and Outlook
At the same time, Amazon has accused Perplexity of enabling users to make purchases on Amazon’s platform through its Comet assistant, and has issued a legal warning to halt this behaviour.
The vote at the conference also highlighted broader concerns about a potential bubble forming in the AI sector, with many participants warning that valuations have risen far faster than underlying financial performance.
Some founders described this moment as a needed “reality check,” especially for startups that lean heavily on momentum and public excitement rather than proven revenue strategies.
While the poll does not predict Perplexity’s immediate downfall, it reflects a growing demand for financial discipline as the AI industry shifts from experimentation to profitability. Insiders suggest that the coming year will determine whether Perplexity becomes a standout success or one of the early casualties of an overheated AI market.
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