New Delhi: Google challenger Neeva has announced that it is discontinuing its consumer search business and shifting its focus to AI and the enterprise. The founders of Neeva, Sridhar Ramaswamy and Vivek Raghunathan, explained in a recent blog post that the company faced significant challenges in attracting new users and the current economic climate made it unviable to continue its consumer search operations.
Neeva was founded in 2019 by former Google employees and was initially launched as an ad-free, subscription-based search engine in the United States. Later, it introduced a free tier to attract more users. While Neeva claimed to have gained over 600,000 users, the majority were on the free plan. In an attempt to grow its user base, Neeva expanded globally, starting with Europe, and aimed to revolutionize the search experience by using a new generative AI engine that provided a single answer by combining multiple sources and results, moving away from the traditional “10 blue links” approach.
The company also developed a standalone generative AI search app called Gist, which was released on Android. However, its planned iOS launch in March faced continuous delays without a clear explanation. The tough economic conditions, evident from the number of layoffs in the tech industry, likely affected Neeva as well. Despite raising more than $75 million in funding, including support from renowned investors like Sequoia and Greylock, Neeva failed to secure a Series C round, indicating the difficulties it faced.
While Neeva aimed to provide a genuine alternative to Google by offering an ad-free experience and its unique search stack, competing against the search giant proved to be an enormous challenge. Microsoft, another major player in the search market, had recently incorporated OpenAI’s ChatGPT into its Bing search engine, prompting Google to accelerate its own efforts with Bard. This created a David vs. Goliath & Goliath scenario for Neeva, although it did receive support from other competitors like You.com and Brave. Ultimately, Neeva did not experience the expected growth, making it difficult to convince users to switch from established incumbents, primarily Google.
According to Neeva’s founders, convincing users to pay for an ad-free search experience was not the most challenging aspect. Instead, the main hurdle was getting users to try a new search engine in the first place. The founders highlighted the difficulties associated with changing default search settings and helping people understand the difference between a search engine and a browser. Acquiring users proved to be a formidable task.
In light of these challenges, Neeva has made the decision to wind down its consumer search business and explore opportunities in AI and enterprise-focused services. The company’s shift in focus reflects the complexities of competing in the search market and the importance of user adoption in the face of well-established incumbents.
