Perplexity AI became the unexpected centre of debate at the Cerebral Valley AI Conference in San Francisco, where more than 300 founders, operators and investors voted it the startup “most likely to fail.” The fast-growing AI answer engine topped a list of high-valuation companies that attendees believe face significant risk, with OpenAI following closely behind. The closed-door poll, conducted by organiser and journalist Eric Newcomer, quickly emerged as the most talked-about moment of the event.
Concerns voiced by participants largely focused on Perplexity’s steep twenty-billion-dollar valuation and its accelerated push into multiple markets without what many see as a stable or defensible business model. Despite the company’s efforts to bolster its platform through improvements to its Comet Assistant and new features designed around privacy and accuracy, doubts around long-term monetisation continue to circulate. Investor anxiety grew further after Amazon issued a legal warning related to purchases being made on its platform through Comet.
The outcome of the vote also highlighted broader fears of overheating in the AI sector, where funding and valuations are perceived to be outrunning business fundamentals. Several founders described the sentiment as a much-needed corrective for startups relying more on hype than on validated revenue strategies. Although Perplexity remains well-funded and highly visible, many insiders believe the next year will determine whether it evolves into a dominant player or becomes an early example of the market’s expected correction.
