Indian American Aravind Srinivas’ Perplexity AI Believes it has Shot at Merger Bid With TikTok
- While the potential deal would likely take months to complete, it would create a new merged entity combining the free search engine, the social media app, and new capital partners.
A day before TikTok shut off in the U.S. for a few hours on the weekend, Perplexity AI officially made a play for the social media app, CNBC reported. The deal would create “a new merged entity combining Perplexity, TikTok U.S. and new capital partners,” the business news channel added.
CEO Aravind Srinivas founded Perplexity AI in 2022 with Google researcher Denis Yarats and world champion at competitive programming Johnny Ho. It is both a search engine and AI chatbot, and recently launched a shopping assistant supported by payment firm Stripe.
A source told CNBC that “the new structure would allow for most of ByteDance’s existing investors to retain their equity stakes and would bring more video to Perplexity.” As ByteDance has “publicly implied it will not sell TikTok U.S.,” Perplexity AI “believes it has a shot with its bid,” the source said, “since the proposal is a merger rather than a sale.”
The source told CNBC that “a fair price is well north of $50 billion” but added that “the final number attached to the proposal” will be decided depending on “which of ByteDance’s existing shareholders want to remain part of the new entity and which want to cash out.”
However, the potential transaction would likely take months to complete. As of now, TikTok has restored his service in the U.S., after President Trump said he “most likely” would give TikTok 90 more days to work out a deal.
Meanwhile ByteDance has reportedly explored the option of a TikTok deal with Tesla founder Elon Musk.
Perplexity holds a $8 billion valuation after its latest funding round, according to Investor’s Business Daily. Its early investors included Amazon.com founder Jeff Bezos, Nvidia and the venture firm New Enterprise Associates.
The merger attempt came a day after the Supreme Court upheld the federal law that will ban TikTok unless the China-based parent company sells the popular short video app’s U.S. operations.