Meta’s Strategic Moves in the AI Space Reveal High-Stakes Interest in Emerging AI Startups
Meta, the parent company of Facebook, Instagram, and WhatsApp, reportedly explored the possibility of acquiring Perplexity AI, a rising competitor in the AI-powered search and conversational assistant space, before ultimately deciding to invest in Scale AI earlier this year.
A Glimpse Into Meta’s AI Playbook
According to insiders familiar with the matter, executives at Meta engaged in preliminary discussions with Perplexity AI, a startup known for its innovative approach to search using natural language and AI-driven summarization. These conversations never advanced to a formal acquisition offer but underscore Meta’s strategic intent to bolster its AI portfolio in ways that align with its broader ambitions in the generative AI ecosystem.
Perplexity, founded in 2022, has rapidly gained attention for challenging traditional search engines with an AI-native alternative that returns concise, cited answers instead of links. Backed by investors like Jeff Bezos and Nvidia, the startup recently surpassed a $1 billion valuation, reflecting surging interest in search reimagined through large language models.
Meta’s Investment in Scale AI
Shortly after evaluating Perplexity, Meta opted to participate in a $1 billion funding round for Scale AI, a data infrastructure company vital to training large AI models. Scale AI provides high-quality annotated data used in everything from self-driving cars to large language models like Llama, Meta’s own open-source model series.
The investment marks Meta’s recognition of the strategic importance of foundational data labeling and model tuning, especially as it accelerates development of open AI models intended to compete with offerings from OpenAI and Google DeepMind.
Why Perplexity?
While Meta’s interest in Perplexity may seem surprising, it fits a pattern of exploring potential acquisitions that offer differentiated user experiences or technology it could integrate into its broader ecosystem. Perplexity’s real-time, citation-backed, chatbot-like search results appeal to users seeking accuracy and transparency—two priorities Meta has struggled with historically across its social platforms.
Moreover, owning or influencing a new wave of AI search could allow Meta to compete more directly with Google in yet another market: information discovery and recommendation.
What’s Next?
While a Perplexity acquisition didn’t materialize, Meta’s quick pivot to Scale AI suggests a prioritization of infrastructure over interface—at least for now. But with the AI race heating up, it’s likely Meta will continue to explore partnerships and acquisitions that fill strategic gaps in search, data, and model deployment.
These maneuvers illustrate a broader trend: Big Tech is moving aggressively to secure its place in the AI arms race, not only through internal development, but also by scouting and investing in external innovation.
