Exclusive: startup ProRata.ai launches an AI search engine to pay content creators
Artificial intelligence Startup ProRata.ai aims to bring a fairer compensation model to media companies with the launch of its AI-powered search engine, Gist.ai.
The startup uses AI generation to accurately attribute search results and share revenue with content owners. This revenue is generated by subscriptions and advertisements distributed by Gist. People can sign up for early access to Gist, with a full release planned for early 2025.
“Most of the others [AI] today’s services steal, scrape, [and] shoplifting content,” said Bill Gross, CEO of ProRata. “Our goal is to move the industry toward fair payment. »
With AI search engines like Perplexity and OpenAI ChatGPT gaining ground, users are increasingly abandoning link browsing in favor of concise, summarized answers. Meanwhile, advertisers are wondering how to adapt their strategies to this new wave of AI-driven search.
ProRata—valued at $130 million— also announced content licensing deals with a range of media companies, including Arena Group (Athlon Sports, Men’s Journal, TheStreet Parade), Atlas Obscura, BuzzFeed, Recurrent Ventures, Graham Holdings Company (Foreign Policy, Slate) and ADWEEK, among others. . Over the past five months, ProRata has signed deals with 400 media partners, the company told ADWEEK.
ProRata plans to share half of its subscription and advertising revenue with its licensing partners, which already include titles like Time, Fortune, Financial Times, Daily Mail, Axel Springer and Universal Music Group.
“BuzzFeed is proud to partner with ProRata to accurately and fairly bring high-quality content and journalism to play in a growing news ecosystem,” Ken Blom, BuzzFeed’s chief business officer, said in a statement. . “ProRata’s approach to fair content attribution, transparency and sourcing makes it a leading partner in developing AI for publishers. »
Gross, who was credited With the invention of the pay-per-click keyword advertising model, the backbone of the digital advertising industry, sees ProRata as a way to solve the problem of AI companies siphon off media traffic and advertising revenue. Unlike traditional media types like music streaming, which track revenue via views or streams, generative AI does not have a clear attribution metric. Gross said ProRata’s model is similar to how Spotify tracks streams to distribute revenue.
ProRata raised a $25 million, Series A in August from Mayfield, Revolution Ventures, Prime Movers Lab and Gross’s Idealab Studio (a technology incubator run by Gross).
Gist: an SEO-independent search engine
Gist does not provide results based on SEO keywords, but provides answers exclusively from content with explicit permission. Available as both an app and a web page, ProRata’s technology uses natural language processing to determine which publishers to feature, selecting content based on its relevance to the user’s query.
Gist provides answers exclusively from content with explicit permission.ProRata.ai
The attribution bar at the top displays the sources of the answer, showing the percentage contribution from different outlets. For example, 34% from The Atlantic, 25% from Time, 25% from Fortune and 16% from The Guardian. Each source is linked to the specific article or content it came from. The thumbnails on the right show the sources of the articles in the abstract itself.
ProRata’s algorithm analyzes AI generation outputs to identify their sources. Without needing details about the training data, the algorithm determines contribution percentages from various creators or editors, according to Gross.
“Then it can use that to prorate the revenue share amount for each of those people by the correct amount,” Gross said, adding that the partners will receive a monthly check from ProRata. The startup is awaiting patent approval.
Subscription and ad revenue strategy
ProRata generates revenue through a premium subscription to Gist, priced at $20/month, which provides an ad-free experience. There is also a free, ad-supported version.
ProRata plans to run contextual ads. Currently, all partners are testing ads in a private beta.
Gross is optimistic that larger AI companies will want to license ProRata’s model. The startup told ADWEEK that it has entered into licensing agreements with two small LLM providers and is in advanced talks with two countries who want to use it to create a nationwide LLM in their native language .
“Our main goal is not to be Google,” Gross said. “[But] show that fair revenue sharing leads to happier partners, better results for users, and convincing other search engines to adopt our technology.
