Startup Neeva announced that it would shut down its search engine on June 2 and expressed the intention of “shifting to a new area of focus,” particularly in developing AI and LLMs. In its recent blog post, company co-founders Sridhar Ramaswamy and Vivek Raghunathan shared the struggle in the business, especially in facing giants like Google, which is not only dominant in the search market but also has all the significant power to influence users over their choice.
The founders shared the challenges of running a search engine with only 50 team members. Nonetheless, this didn’t stop the company from expanding to other countries in 2022 and even exploring AI a year later. It used a subscription model instead of bombarding the place with ads. Ramaswamy, which used to work for Google as senior vice president of advertising and commerce, probably saw it as a good alternative to lure people away from the exhausting ad-filled environment of old search engines. However, as noted by the two execs, the efforts are not enough to change the mind of people in their conventional search engine choices, no matter how good the new selections are.
“…We’ve discovered that it is one thing to build a search engine, and an entirely different thing to convince regular users of the need to switch to a better choice,” the blog reads. “From the unnecessary friction required to change default search settings, to the challenges in helping people understand the difference between a search engine and a browser, acquiring users has been really hard. Contrary to popular belief, convincing users to pay for a better experience was actually a less difficult problem compared to getting them to try a new search engine in the first place.”
To recall, the company launched its NeevaAI creation in 2023. The introduction of this AI-driven search tool was basically earlier than Google’s and Microsoft’s, but Neeva barely caught significant attention from the public. Nonetheless, Neeva is not alone in this, as the same case was (and is still being) experienced by other companies, including You.com. And now that Neeva is quitting its search business, this could be a clear message and indication to small companies of how unbeatable Google is in this field. Even Microsoft itself, despite its multi-billion dollar investment to re-fashion Bing with AI capabilities, is still struggling to chip away at a huge cut of Google’s search market share.
Neeva promised to refund the remaining unused portions of their plans but said the search engine shutdown would also delete users’ data. Yet, on a positive note, the company will still exist and said it would explore the LLM area, adding it “will provide updates on the future of our work and our team in the next few weeks.” Also, it is important to note that the announcement came days after a report about a huge development in cloud giant Snowflake’s plan to acquire the company, indicating that Neeva could still have a bright future despite today’s depressing news.