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Lightcone · 2 min · Jul 11, 2025

Perplexity sees subscriptions and task fees as revenue streams

Aravind Srinivas expects subscriptions, usage-based agent pricing and transaction fees to contribute revenue, but says their economics are still uncertain. The mix matters because task fees may bring more users but lower margins.

Aravind Srinivas

Aravind Srinivas is cofounder and CEO of Perplexity.

Held research roles at OpenAI and Google DeepMind before co-founding the AI search engine Perplexity in 2022.

  • Garry Tan, Host · President & CEO, Y Combinator

    Co-founded Posterous and Initialized Capital, an early Coinbase backer.

  • Harj Taggar, Host · Managing partner, Y Combinator

    Co-founded Auctomatic with the Collison brothers and later Triplebyte.

  • Diana Hu, Host · Managing partner, Y Combinator

    CTO of Escher Reality; after Niantic bought it, ran AR for Pokémon GO.

  • Jared Friedman, Host · Managing partner, Y Combinator

    Co-founded Scribd, which YC funded in 2006; has advised 20+ YC unicorns.

About this segment

Aravind Srinivas expects subscriptions, usage-based agent pricing and transaction fees to contribute revenue, but says their economics are still uncertain. The mix matters because task fees may bring more users but lower margins.

From “Aravind Srinivas: Perplexity's Race to Build Agentic Search”, Jul 11, 2025. Watch the full episode

Answers “How do AI companies make money?” See all 15 answers

“usage based pricing where people are paying an agent for completing a task or people have recurring tasks”
Aravind Srinivasat 28:28 · Lightcone28:28

Takeaways

  1. Subscriptions could grow into a multibillion-dollar business.
  2. Agent tasks could be priced by usage or completed task.
  3. Transaction fees may be valuable, but historically carry lower margins than ads.

In this episode

Full episode
  1. 11:27Google’s incentives leave room for search startups2:48
  2. 17:01A browser can turn an assistant into an agent2:47

  3. 27:33Perplexity sees subscriptions and task fees as revenue streams2:23

  4. 3 more moments in the full episode
Up next · LightconeFirst-principles reasoning can expose hidden cost reductions6:20

Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

  1. 27:40

    Let's talk next about business model. Your main competitor, Google, their business model, as you've talked about, is selling ads. and you think that prevents them from being really good at what you're doing. So what will your business model be and how will you get it to be on the order of magnitude of Google's? I don't know if we'll ever get order of magnitude. profits as Google, just to be clear.

  2. 28:02

    And I don't think that's needed. No one in the history, even Google themselves, never has had another business that had the margins that Google has. So it's completely reasonable to get something far, far better than any public company out there right now, and be still way below Google. Number two, I think the subscription revenue is really encouraging. We never expected to get this far. And then we think like we can grow at least, you know, a few billions a year and just subs, which is a great business usage based pricing where people are paying an agent for completing a task or people have recurring tasks and they pay based on, you know, every single use of the task.

  3. 28:45

    And they normalize this system based on like how much it would take to hire a person to do that for them is going to be a thing. I don't exactly know how it's going to play out, what are the margins going to be on that. Potentially, it's going to be way better than subscriptions in terms of volume of people who would pay for it, but it might be lower margins because it's usage-based, so you're still going to be spending on all those queries.

  4. 29:08

    Someone might be paying a subscription to one of these AI apps and might not have used it for an entire month. And so that's good margins on that user, right? So I don't actually have a clear sense of how this is all going to evolve, But all I know is subscriptions and usage-based pricing are going to be a thing. Transactions, you know, if people start buying more through AIs, taking a cut out of the transactions is good.

  5. 29:33

    It's going to be, CPAs have historically been way lower margins than CPCs, which is why Google never became a transaction platform. Which is why I said, like, you're going to make a lot of money here. You may never make as much money as Google. Yeah, Google's business model is potentially the best business model ever created. Yeah, it's fair to not.