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French startup Mistral AI storms the AI scene, raises $113M seed funding to rival OpenAI

Mistral-ai close to securing 450 Euros funding

Artificial intelligence (AI) has emerged as a prominent buzzword in the business world, captivating the attention of major industry players such as Amazon, Google, and Microsoft. These tech giants are making significant investments, amounting to billions of dollars, as they compete to develop cutting-edge AI technology. And Europe is not planning to lag behind in the AI race.

Mistral AI, a European startup has secured a significant seed-stage financing round of over €105 million, with Lightspeed as the lead investor. The round also saw participation from notable investors including Redpoint, Index Ventures, Xavier Niel, JCDecaux Holding, Rodolphe Saadé, Motier Ventures in France, La Famiglia and Headline in Germany, Exor Ventures in Italy, Sofina in Belgium, and First Minute Capital and LocalGlobe in the UK. 

Mistral AI also counts French investment bank Bpifrance and former Google CEO Eric Schmidt as shareholders. Reportedly, the funding round has resulted in a valuation of $260 million for Mistral AI, with a total funding amount of $113M and it is Europe’s largest-ever seed round.

The company, founded by former members of Meta’s and Alphabet’s AI research teams, aims to provide businesses with cutting-edge generative artificial intelligence (AI) technology, automating existing processes and fostering innovation in new product development.

A trio of visionary founders

Mistral AI’s success is attributed to its exceptional founding team, consisting of Arthur, Guillaume, and Timothée, based out of Paris. These three co-founders, who first met during their studies at École Polytechnique and École Normale Supérieure, possess a unique combination of technical expertise and entrepreneurial spirit. Recognising the need for a European, open-source project in the field of Generative AI, they embarked on a mission to become a major global player in the industry.

Their deep technical knowledge, gained from working in prominent AI labs, positions them among a select group of individuals worldwide with a deep understanding of training and operating large language models at scale. Arthur’s experience at DeepMind, particularly in optimising large language models, and Guillaume and Timothée’s work on the highly popular LLaMa project, have equipped them with invaluable expertise in the field.

Embracing open source and contributing to the community

Observing the success of open-source projects such as Stability, Grafana, Yugabyte, Elementor, and Mulesoft, the company recognises the value that open-source initiatives bring to the forefront. The French startup aims to build a credible open-source alternative to existing Large Language Model (LLM) players while actively contributing to the community.

In the context of AI, where significant research often takes place in closed environments, Mistral’s commitment to open source is particularly crucial. By embracing open-source principles, the company avoids concerns related to vendor lock-in and black box models, ensuring transparency and regulatory compliance for enterprise customers.

Europe’s role in AI 

Mistral AI’s latest funding round not only signifies its own growth but also reflects the thriving European ecosystem. Europe has long been recognised for its strong research foundations, and Mistral aims to leverage this potential to play a decisive role in the AI field. As European politicians and leaders acknowledge the importance of their participation in the emerging world order, Mistral seeks to contribute to European digital sovereignty and uphold European values.

With office launches in the UK, Germany, and France, Mistral actively seeks partnerships with like-minded European founders who share their ambition and vision.

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