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2024 has been an exceptional year for Perplexity. The AI search startup, founded by former DeepMind and OpenAI researcher Aravind Srinivas, raised hundreds of millions of dollars in its latest funding round. reportedly valued the company at $9 billion and introduced several notable features, including Pages, Spaces, and innovative shopping experiences.
These developments have solidified Perplexity’s reputation as an AI-first knowledge discovery engine, differentiating itself from traditional search giants like Google and Bing, which are adding AI capabilities to their existing engines.
However, the journey is far from over.
In the face of increasingly intense competition, Perplexity is expanding its reach with a new addition to its portfolio: Coal. The company has just acquired This startup, for an undisclosed sum, aims to address the “data gap” that companies encounter with AI search and streamline the knowledge discovery process in their workflows.
Carbon has developed a comprehensive recovery framework that streamlines the process of connecting external data sources to LLMs. Users can take advantage of the universal Carbon API either SDK to synchronize your data sources and retrieve data for use with LLMs. It offers native integrations with 20+ data connectors and supports 20+ file formats, including text, audio, and video files.
From individuals to business users, almost everyone today uses AI search as part of their workflows. The idea of the technology is quite simple: you do not need to go through a large number of links and content to find relevant knowledge and information. Instead, the information will come to you as a direct response to your query.
Perplexity has thrived on this approach, using a variety of large language models to retrieve information from the web and simplify the way users work. It even allows teams to extract information from their personal or business files, such as PDF files and Word documents.
But here’s the thing. The web hosts public information and uploading internal files (PDFs, conversations, images) individually is not feasible for business users dealing with large volumes of proprietary data. This affects the quality of the responses, keeping them generic and devoid of important contexts relevant to the organization.
Highlighting this “data gap,” Sanjeev Mohan, former research vice president of data and analytics at Gartner, told VentureBeat that one of the biggest AI trends for 2025 will be ETL for unstructured data. It will enable teams to extract and transform data from dispersed internal sources, ultimately enabling their LLMs to generate highly relevant and accurate responses.
Now this is exactly what Perplexity plans to do with the acquisition of Carbon’s comprehensive and optimized recovery framework. Perplexity will integrate Carbon’s retrieval engine and connectors into its technology stack, giving users of the search platform a direct way to connect their various data sources, from Google Docs and Notion to Hubspot and Slack.
This, the company claims, will expand the set of knowledge powered by the AI search engine, making its answers more complete, relevant and personalized for users.
While Carbon was just acquired by Perplexity and the integration hasn’t been executed yet, it’s pretty easy to imagine how the additional data connectors will improve the workflows of enterprise teams using the AI search engine.
For example, if one has to change the date of a release and needs to determine the latest deadline and the guidelines set by his team, Perplexity could analyze all the data in Google Docs, Notion and Slack, and make the necessary adjustments. correlations: to find the information that answers the question.
In essence, you would no longer have to worry about tying together web context, individual applications, and messages. The platform does everything on its own to provide the answer.
“The notable benefit of this setup is that our technology can find the answer without having to identify the document/database where that information is stored,” Sara Platnick, communications lead at Perplexity, told VentureBeat.
Another example, he said, could be extracting information about client meetings. Perplexity could get conversation details and focus from connected CRMs in no time.
In particular, by leveraging Carbon’s Recovery Augmented Generation (RAG) workflows, Perplexity is making enterprise search more accessible, saving businesses the hassle of building their own RAG pipelines from scratch.
“By finding and interpreting proprietary data with Perplexity and Carbon, companies can address a variety of multi-faceted generic AI use cases. “We found that the top users are focused more on customer service, document processing, image processing and recommendation engines, Kevin Petrie,” BARC US research vice president told VentureBeat.
Purchasing Carbon is just the beginning. The real key will be execution, or the fluidity and security with which the startup’s technology is integrated. After all, we’re talking about proprietary data from some of the most critical knowledge repositories that companies maintain.
“Companies are rightly wary of exposing their intellectual property to the public. Perplexity and Carbon will therefore need to provide governance controls that ensure companies can keep their data within their own firewalls. “They have no interest in sharing secrets or training a public model to imitate their intellectual property,” Petrie added.
For Perplexity’s part, Platnick noted that “all information from internal and private sources in the engine is encrypted, as is all data transmitted and stored in Carbon data connectors.” He also noted that the company has additional protections to ensure that private documents remain private and are not accessible to unauthorized users.
For now, there is no specific timeline for Carbon’s integration with Perplexity. However, the startup will be deprecating its managed API on March 31, 2025. Existing customers using the API have already been notified of their decommissioning, and the Carbon team will assist them in the transition.