Confusion AI made a bid to merge with TikTok US

Perplexity AI made a play for TikTok on Saturday by submitting a bid to parent company ByteDance to create a new combined entity that would combine Perplexity, Tiki US and new capital partners, CNBC has learned.

The new structure will allow most of ByteDance’s existing investors to retain their equity stake and will bring more video to Perplex, according to a source familiar with the situation, who asked not to be identified because of the confidentiality of the deal.

Confusion AI, an artificial intelligence search engine startup that competes with OpenAI googleIn the year It started 2024 at a valuation of $500 million and ended the year at a valuation of $9 billion, after attracting increasing investor interest amid the generative AI boom — as well as controversy over hacking allegations.

AI-powered search is considered one of Google’s key concerns by investors, as it changes the way consumers find information online. Last year, by the end of 2022, ChatGPT introduced a search engine called OpenAI SearchGPT, which started the generative AI craze. Google later launched “AI Overviews” in search, allowing users to see a quick summary of answers at the top of results.

Although any potential transaction between Perplexity AI and ByteDance would take months to complete, the app will “go dark” in the U.S. on Sunday unless TikTok can confirm it won’t be penalized by the Biden administration. AppleGoogle and other service providers to accommodate him – President-elect Donald Trump He told NBC News on Saturday After being sworn into office on Monday, he said he might give an additional 90 days to Tik Tok.

In a video posted to Tik Tok on Friday, CEO Show Zi Chew said, “I want to thank President Trump for his commitment to work with us to make Tik Tok available in the United States.

Byte Dance said publicly. It does not sell Tik Tok US, of which Perplexity AI is a part, believes it has a shot at bidding — because the recommendation is for integration rather than sales, the source told CNBC.

The source believes the actual value is “north of $50 billion,” but the final number tied to the decision will depend, in part, on which ByteDance’s existing shareholders want to remain part of the new entity and cash out. .

EDIT: Perplexity’s AI bid for TikTok’s new integrated entity combines Perplexity, TikTok US and new capital partners. An earlier version of this article misread one of its contributors.