Founded just under two years ago, Mistral AI, a French start-up focusing on generative artificial intelligence, rapidly grew and emerged as Europe’s primary contender against American corporations.
The company completed a funding round of €600 million in 2024, which was the biggest fundraiser in French Tech that year, according to KPMG. This increased its valuation to around €6 billion.
Founded in April 2023 by Arthur Mensch, a French university graduate and former DeepMind collaborator at Google, it was established with two former Meta researchers, Guillaume Lample and Timothée Lacroix.
The fledgling firm secured over 1 billion euros (equivalent to around 6.2 billion reais) within a year.
“Our goal over the next decade is to be a key player in influencing technology and its utilization,” Arthur Mensch stated to AFP at the Paris-based startup headquarters without a logo.
Mistral and OpenAI ChatGPT both announced on Thursday (16) that Mistral provides a conversational AI robot named Le Chat, similar to ChatGPT, that can now utilize AFP text content in six languages to generate responses about current events and information.
It also offers a vast language model (Mistral Large) dedicated to text creation as well as specialized models for image processing and code generation.
Star –
Claude de Loupy, an expert in language-oriented artificial intelligence, explains that “It’s a star” emerged when investors were seeking a French version of “OpenAI.” The key strength of this project was its ability to provide high-quality models right from the start.
The company chose open source approaches, unlike its American rivals like OpenAI and Anthropic, which have been criticized for being opaque.
“Our customers can implement solutions on their infrastructure with better data governance than our American competitors,” Arthur Mensch explains.
The young company distinguished itself with its compact models that can be installed on computers or smartphones. These models use less energy, making them more affordable compared to their rivals.
He also entered into multiple distribution contracts with Google, Microsoft, Amazon, and IBM to ensure their products are readily available.
Mistral currently has around 100 employees at its recently renovated Paris facilities and is looking to grow. The company, which has not yet made a profit, is concentrating on expanding both in France and internationally, with offices already established in the UK, the United States (Palo Alto, California), and Singapore.
Generative artificial intelligence is a transformative technology that will impact the entire world, with all regions recognizing the need to adopt it at varying paces and with some level of autonomy from American entities, according to Mensch.
Capital requirements –
Creating these artificial intelligence models demands a substantial amount of investment. The Mistral has strong financial backing from major companies like Google, Meta, Microsoft, and Amazon, making it challenging for others to compete on the same level, as stated by Claude de Loupy.
Elon Musk’s AI company, xAI, secured $6 billion in new funding, and OpenAI, backed by Microsoft, raised $6.6 billion.
Will Mistral, hailed as a “French prodigy” by President Emmanuel Macron, receive ongoing political backing to stay competitive in the global AI race, and at what cost?
The German startup Aleph Alpha had to halt the development of large language models in order to shift its focus to providing consulting services for companies due to the significant financial requirements of the new technological endeavor.
“The capital requirements will not decrease,” states Arthur Mensch, but “We currently face an ongoing need.”
“The European market should come together and acknowledge that European technology requires assistance. Collaborating with local stakeholders is beneficial both immediately and in the future,” he suggests.