Perplexity is an advanced algorithm which can locate information for you. It resembles an alternative form of search engine. You can converse with it as though you were speaking with a human instead of entering keywords.

Perplexity has drawn investors’ attention. During a recent investment round, the company’s valuation reached $520 million in March 2024. Let’s explore how to invest in Perplexity AI now.

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Is Perplexity AI Up for General Trading?

No, at this time Perplexity is not open for trade by the general public. Founded in August 2022 by Andy Konwinski, Johnny Ho, Denis Yarats, and Aravind Srinivas, it is a new business. Once employed by OpenAI, the industry leader in generative AI, Srinivas is now the CEO of Perplexity. The company has three rounds of funding available.

When Would Perplexity AI Be Accessible for Public Trading?

There right now is no information available on Perplexity’s intentions to go public. According to some sources, they could soon receive capital which values them at over $1 billion, thus becoming a unicorn: a word used to describe wealthy firms.

If everything goes according to plan, Perplexity might need a few years to go public as they just launched in 2022.  Tech companies required several years to go public, with the exception of the dot-com boom, when companies hurried to go public because investors could not get enough of internet enterprises.

For instance, it took six years for Alphabet formerly Google to move from its founding in 1998 to its 2004 public offering. It took Meta Platforms, the name of Facebook at the time, eight years from its founding in 2004 to become public. With IPOs, investors are cautious now than they were during the dot-com crashes.

They want evidence showing the company is expanding and turning a profit. Perplexity would need a few years to demonstrate it can live up to those expectations.

How Can One Purchase Perplexity Stock?

There remain options for investors to invest in Perplexity, even though you cannot purchase it direct because it is not listed on a public exchange. Purchasing shares through employee stock purchase plans or investing through venture capital firms are two options.

However, in order to use these choices, you often need to be a wealthy and accredited investor. Investing in the stocks of companies which own Perplexity shares is an easier option.

Create a Brokerage Account

You should open a brokerage account which enables you to purchase and sell stocks before you may invest in these equities. There are numerous brokerage choices, including E-Trade, Fidelity, Robinhood, and Charles Schwab.

Decide on a Budget

Determining the amount of money, you feel comfortable investing is the next step after creating your brokerage account. Consider into account your assets, income, and opinion on the investment. You could wish to invest any additional of your money in it if you are confident about it.

You should not invest over ten percent of your total portfolio in a single stock.

Research

It is time to start excavating now. Find out everything you can about the investment, including its strengths, potential weaknesses, and associated dangers. Writing down your ideas is beneficial, if you want to keep them to yourself or decide later on whether to purchase the stock.

As of right now, Nvidia is the sole publicly traded firm with shares of Perplexity. With a market valuation of over two trillion, Nvidia is a major player, but its investment in Perplexity is probable just a few million dollars. You are just getting just a little bit of Perplexity if you buy Nvidia.

Purchasing Nvidia might continue to be a wise decision. When it comes to AI hardware, Nvidia leads the field; a partnership with Perplexity could help Nvidia advance its position. Nvidia might be considering purchasing Perplexity.

Put in Your Order

It is time to place your order after you have completed your research, budget, and brokerage account setup. Market orders and limit orders are the two main categories of orders. You purchase or sell using a market order at the going rate. You can set a price which you are willing to pay or accept by using a limit order.

You now have additional authority over the transaction as a result. Although a market order is executed sooner, a limit order offers you control over the price. On average, the Motley Fool suggests using a market order.

Does Perplexity Generate Revenue?

Having just been operational for 20 months, Perplexity is just beginning to generate revenue. It was losing money as of January 2024, bringing in less than $10 million a year. Perplexity appears to be following the pattern of tech companies which prioritize market share growth over profit margins.

Perplexity is going after a huge market since its goal is to disrupt the Google-dominated search sector. In order to draw in additional clients, the company is going to maintain investments in enhancing its offering, increasing the capacity of its computers, and marketing.

How to Invest in Perplexity AI: Should You Invest in Perplexity

It is impossible to evaluate Perplexity just on the basis of its financial performance because it is so new. Because of its current low revenue in relation to its valuation, conventional financial indicators are unable to provide a clear picture.

Investors ought to take into account its capacity for expansion and its aptitude for grasping the market chance which it is pursuing. Leading AI search marketing company BrightEdge reports the Perplexity’s organic search share is increasing by 39% each month, or several hundred percent annual.

As of January, Perplexity claimed to have 10 million active monthly users, albeit just a small percentage of those users are paying ones. The list of investors who had prior investments in Perplexity is encouraging.

Prominent figures in the IT sector such as Amazon’s Jeff Bezos, Shopify’s Tobi Lutke, and YouTube’s former CEO Susan Wojcicki are among them. It is not always a wise decision to invest in Perplexity just because known figures such as Bezos and Lutke endorse it. Their support implies Perplexity is valued.

There is a danger involved in investing in Perplexity. Since it is yet a small business, success is not guaranteed.

ETFs Experiencing Perplexity

As Perplexity is not listed on an exchange, there are no exchange-traded funds (ETFs) which are associated with it. Since Nvidia owns a stake in Perplexity, you can indirect purchase it through exchange-traded funds which own Nvidia.

You might choose a broad index fund which incorporates Nvidia, such as the Vanguard 500 Fund or the Invesco QQQ Trust. For a targeted investment, consider the Van Eck Semiconductor ETF, which concentrates on semiconductor firms such as Nvidia and Perplexity indirect.

Despite the fact the these ETFs are reasonable, you continue to have a minimal relationship to Perplexity if you invest in them. As an alternative, you might look into AI ETFs, which do not include private companies such as Perplexity but do contain stocks linked to AI, such as Nvidia.

Thinking About Buying $1,000 Worth of Nvidia Stock

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The top 10 stocks which the Motley Fool Stock Advisor team think have the potential to provide substantial returns have been determined. Nvidia was not one of them. These five stocks have the potential to provide exceptional returns in the upcoming years.

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Conclusion: How to Invest in Perplexity AI?

Among the promising AI startups operating today is Perplexity. Perplexity is a leader in a distinct area of AI conversation, even though it may not have the same level of prominence as ChatGPT or Google’s Gemini.

The business has huge development opportunities due to its ability to persuade people which it provides a superior alternative to Google Search. Given its present income and development stage, it is doubtful the Perplexity will go public anytime soon for prospective investors. 

Given its disruptive potential and the notable investors it has drawn a sign of support from the IT community.

FAQs: How to Invest in Perplexity AI?

How can I invest in Perplexity AI?

To invest in Perplexity AI, you can explore avenues such as buying Perplexity stock, seeking pre-IPO opportunities, or investing in companies associated with Perplexity.

Is Perplexity AI publicly traded?

Perplexity AI is not publicly traded at the moment. It is a privately held company, which can limit direct stock purchasing options for individual investors.

What are some ways to buy Perplexity stock?

You can buy shares in Perplexity through avenues such as acquiring pre-IPO shares, using a stock advisor, or exploring opportunities to buy or sell stocks related to the AI industry.

Can I sell Perplexity AI stock?

If you own shares in Perplexity, you may be able to sell Perplexity AI stock through a brokerage account or additional investment platforms offering trading services.

Are there any notable investors in Perplexity AI?

Investors such as Denis Yarats and Aravind Srinivas have shown interest in Perplexity AI, indicating a positive stance on the potential of the company.

What is the valuation of Perplexity AI?

The valuation of Perplexity AI is subject to fluctuations based on funding rounds, market trends, and developments within the AI industry.

How can I get exposure to Perplexity in the AI industry?

To gain exposure to Perplexity in the AI industry, you can consider investing in AI hardware, exploring AI tools, or monitoring companies related to Perplexity’s initiatives.