March 20 (Reuters) - Perplexity AI is in talks to raise

funds at an $18 billion valuation, a person familiar with the

matter told Reuters on Thursday, as the Nvidia ( NVDA )-backed

startup looks to grow and capture soaring demand for its search

tools.

The jump in valuation doubles the previous $9 billion

figure, reported by Reuters in November.

Perplexity is an AI startup that provides information by

searching the internet, just like ChatGPT and Google's Gemini,

and is backed by Amazon.com ( AMZN ) founder Jeff Bezos and

Japan's SoftBank Group.

The company has discussed raising between $500 million and

$1 billion in the round, the source added.

The growing adoption of chatbots and rise of AI agents,

which can take actions for users, have increased investor

enthusiasm in such startups.

The AI startup has been upgrading features on its platform

to better compete with Google's Gemini and Microsoft ( MSFT )-backed

OpenAI's ChatGPT.

Last month, the company teased a new web browser, Comet,

which can use AI to not only retrieve information but also

understand complex queries, execute tasks and make decisions.

Its Deep Research feature can undertake extensive research

by conducting dozens of searches and reading hundreds of sources

to deliver a comprehensive report.

Bloomberg News was first to report the increased valuation.

Perplexity is among the leading firms attempting to

challenge incumbents in the search engine market such as

Alphabet's Google.

Perplexity has faced accusations from media organizations,

such as News Corp-owned outlets, Forbes and Wired, that the

startup engages in plagiarism and copying of its content. The

company has a publisher partnership program to work with news

firms.

OpenAI closed a $6.6 billion funding round in October, which

could value the company at $157 billion and cement its position

as one of the most valuable private companies in the world.