AI: The Bigger Picture behind Perplexity being 'So Good, They Can't be Ignored'. RTZ #758
The Bigger Picture, Sunday June 21, 2025
Steve Martin help make famous the line “Be so Good, they can’t ignore You”, as the surest path to success. In this AI Tech Wave, one of the companies heeding that advice is Perplexity.ai. With Founder/CEO Aravind Srinivas making sure the world notices his company every day on X/Twitter.
Perplexity is a native AI company I’ve written about in admiring tterms several times in these pages. And in video podcasts.
This week the market seems to be heeding these words as well, because Perplexity has come up as a possible acquisition target for Meta and Apple. And likely some other we haven’t yet read about in the media. It’s all part of some strategic chess games going on in the AI global marketplace, and that is the Bigger Picture I’d like to discuss this Sunday.
Let’s first discuss the ‘What’ is going on before delving into the ‘Why’ it’s going on.
As I highlighted in item #1 in the Weekly AI Summary yesterday, Meta has been a catalyst this week in the AI world on a number of fronts:
“Meta builds AI ‘M-Team’ in AI Talent War:”
“Meta Founder/CEO Mark Zuckerberg is driving an accelerated effort to build it’s AI capabilities beyond Meta AI and open source Llama. Especially relative to industry peers Google, Microsoft/OpenAI, Elon Musk’s xAI/X/Grok/Tesla et al. And heightened competition from AI companies in China like DeepSeek, Alibaba et al. After its 49% investment in AI Data leader Scale.ai and bringing on its founder/CEO Alexandr Wang to head Meta’s ‘Superintelligence’ team the company is in talks to bring on Github founders and VCs Nat Friedman and Daniel Gross as part of its’ AI Management Team, aka ‘M-Team’.”
“Meta also held talks to acquire Perplexity under similar terms before Scale.ai, and has discussed hosting Ilya Sutskever’s Safe Superintelligence in Meta AI data centers. It’s clear that Zuckerberg is thinking ‘out of the box’ in expanding Meta’s AI envelope. The company also announced upgraded AI ‘Smart Glasses’ with Oakley, expanding its portfolio beyond Ray-Ban Smart Glasses. Meta Founder/CEO Mark Zuckerberg is increasing his overallI ambitions across the board. More here and here.”
Meta Founder/CEO Mark Zuckerberg is definitely out hunting for big AI talent and capabilities.
As Bloomberg explains in “Meta Discussed Buying Perplexity Before Investing in Scale”:
“Meta Platforms Inc. held discussions with artificial intelligence search startup Perplexity AI Inc. about a possible takeover before moving ahead with a multibillion-dollar investment in Scale AI, according to people familiar with the matter.”
“The two companies couldn’t come to an agreement and decided not to pursue the deal, said the people, who asked not to be named as the details of the talks aren’t public. The financial terms under discussion could not be learned. Perplexity recently closed a new round of funding at a $14 billion valuation.”
“Meta also attempted to hire Perplexity Chief Executive Officer Aravind Srinivas to join the social media company’s new “superintelligence” team, which is focused on building more powerful AI systems, the people said.”
“The talks with Meta, which have not previously been reported, highlight Meta CEO Mark Zuckerberg’s willingness to use deals and big hires to catch up in the AI race. The talks took place before Meta finalized a $14.3 billion investment in Scale AI that gives it a 49% stake in the data-labeling startup.”
So far so good.
Now Bloomberg in a separate piece by Mark Gurman notes in “Apple Executives Have Held Internal Talks About Buying AI Startup Perplexity”:
“Apple executives have discussed potentially bidding for artificial intelligence startup Perplexity AI to address the need for more AI talent and technology.”
“A deal would help Apple develop an AI-based search engine, which is part of efforts to cope with the potential loss of its longstanding arrangement with Google.”
“Apple has also considered teaming up with Perplexity instead of buying it, which would involve adding Perplexity as an AI search engine option in Apple’s Safari web browser and integrating it into Siri.”
And goes into more detail on Apple, beyond its publicly discussed ‘Apple Intelligence’ Strategy:
“Apple Inc. executives have held internal discussions about potentially bidding for artificial intelligence startup Perplexity AI, seeking to address the need for more AI talent and technology.”
“Adrian Perica, the company’s head of mergers and acquisitions, has weighed the idea with services chief Eddy Cue and top AI decision-makers, according to people with knowledge of the matter. The discussions are at an early stage and may not lead to an offer, said the people, who asked not to be identified because the matter is private.”
“Such a deal would help Apple develop an AI-based search engine, part of efforts to cope with the potential loss of a longstanding arrangement with Google. That partnership, which involves making Google the default browser on devices, generates roughly $20 billion a year for Apple — and is now under threat from US antitrust enforcers.”
“To date, Apple executives haven’t discussed a bid with Perplexity management. Bloomberg News reported earlier Friday that Meta Platforms Inc. tried to buy Perplexity earlier this year.”
The wheels within wheels part of all this is the potential role that Daniel Gross mentioned in the Meta discussion above potentially plays here as well. IF HE opts not to join Mark Zuckerberg’s AI Superintelligence ‘M-Team’:
“Apple and Meta have been waging a broader fight for talent. Meta recently engaged in discussions to hire Daniel Gross, the co-founder of AI company Safe Superintelligence Inc. While the discussions between Meta and Gross are advanced, Apple has attempted to persuade him to join it instead.”
“In 2013, Gross sold a startup named Cue to Apple. That purchase helped form the basis of some early AI features in iOS, the operating system for the iPhone. And one of Gross’ Cue co-founders, Robby Walker, oversaw the Siri voice assistant until this year. Walker is now leading an Apple project dubbed Knowledge with the goal of creating a rival to OpenAI’s ChatGPT that can use data from the open web.”
“Gross didn’t immediately respond to a request for comment.
“Perica and Eddy Cue, who both report to Apple Chief Executive Officer Tim Cook, are leading the AI acquisition and recruiting efforts.”
All this of course leads to the ‘Why’ of all this, which the Bloomberg piece above starts to answer, at least for Apple:
“The hunt for talent is part of a bid to catch up in generative AI. The company was slow to deliver its Apple Intelligence platform and still lags rivals in key features. A revamped Siri was delayed indefinitely this year, with the company now aiming to have it ready by next spring.”
For Meta, it’s of course a rush by Mark Zuckerberg to productize it’s open source investments in it Llama, AND its multi-billion, accelerating AI Data Center Infrastrure investments, ramping up to over $50+ billion dollars this year alone. And keeping pace with that other founder/CEO Elon Musk, who is making similar investments on AI across his range of companies, X/xAI Grok and Tesla, as I’ve discussed this week as well.
Not to mention Microsoft, Google and Amazon of course, who are making similar if not larger investments in AI Infrastructure. The last two with their ownership of the no.2 US AI company, Anthropic. And of course there’s the pole position company OpenAI, which is aggressively accelerating its leadership position, with and potentially without Microsoft.
All of this makes a particular active set of three-dimensional chess board games, going into the second half of 2025. With all these companies focusing on the coveted Box 6 of my AI Tech Stack chart, at the Applications layer below. It’s a race to bring AI to billions of mainstream users at Scale and as fast as possible, particularly when the interest in ‘AI’ is accelerating worldwide.
Meta, Apple and Google are the key three part of the ‘Mag 7’ with 2 billion++ of daily users worldwide, using their products and services. Distribution right now is the name of the game. Even for companies like Perplexity, who are currently ‘Too Good to Ignore’.
Indeed, as I discussed a few days ago, OpenAI’s Sam Altman brought on senior executive Fidji Simon as its ‘CEO of Applications’ for that daunting objective.
And all this is of course going on with similar accelerating moves in China, on the LLM AI, AI Reasoning and AI Agents fronts.
It’s all a particularly good time for companies and AI founders/executives/researchers who are ‘Too Good to Ignore’. Their time in the sun has come. ‘Acqui-hires’, Strategic Partnerships/Spinoffs, and M&A are in the air.
And that is the Bigger Picture to keep in mind as we assess the this AI Tech Wave for the blaance of this year and beyond. Stay tuned.
(NOTE: The discussions here are for information purposes only, and not meant as investment advice at any time. Thanks for joining us here)
