Perplexity AI, a California-based search startup, is close to raising $500 million in new funding, which would value the company at around $9 billion, according to a recent report by Reuters. The latest funding round will be led by venture capital firm Institutional Venture Partners (IVP), which also has a seat in the startup, states the report.

Perplexity is an AI-based service, known for searching the internet and generating quick summaries for users, which has attracted big-name investors like Amazon's Jeff Bezos and Nvidia. The latest investment marks a sharp rise from the company's $520 million valuation in January, when it raised $73.6 million. 

The rapid growth reflects the rising demand for AI tools following the success of OpenAI's ChatGPT, which recently raised $6.6 billion and may now be valued at $157 billion.

However, Perplexity faces legal issues from media companies. In October, News Corp sued Perplexity, accusing it of copying content without permission. The New York Times also sent a cease-and-desist notice last month, demanding that Perplexity stop using its content for AI summaries.