Mistral AI, established just seven months ago by former researchers from Meta and Google, has secured €385 million (approximately $415 million) in funding, underscoring the escalating interest in a novel form of artificial intelligence powering online chatbots.
This funding round places a valuation of around $2 billion on the company, which currently comprises a team of 22 individuals, with prominent investors such as Andreessen Horowitz and Lightspeed Venture Partners from Silicon Valley participating.
Within the span of six months, Mistral’s valuation has soared over sevenfold. In the summer, the startup raised an initial seed funding round of €105 million (about $113 million), resulting in a company valuation of approximately $260 million.
Mistral specializes in developing technology that allows other enterprises to implement chatbots, search engines, online tutors, and various AI-driven products. The company is part of a select group, including tech industry giants and a few startups, that are pioneering AI technology capable of competing with innovations emerging from OpenAI, the San Francisco startup that catalyzed the AI revolution last fall with the introduction of the ChatGPT chatbot.
Distinctively, Mistral adheres to an open-source philosophy, sharing its AI technology as freely modifiable computer code. This approach is in contrast to industry rivals such as OpenAI and Google, who contend that open-source practices pose risks, potentially enabling the dissemination of misinformation and other harmful content.
The fate of Mistral assumes significance in France, where leaders like Finance Minister Bruno Le Maire view the company as a means for the nation to challenge the dominance of U.S. tech giants. In the broader European context, the AI sector is seen as an arena where the region can gain a competitive edge, given its historical lack of impactful tech companies dating back to the dot-com boom.
Investors are directing significant funds toward other startups that embrace the open-source model. Perplexity, founded last year by a group of accomplished researchers, recently secured a $70 million funding round, valuing the company at $500 million.
Anjney Midha, a general partner at Andreessen Horowitz who spearheaded the investment in Mistral, emphasized the belief that AI should remain open. He highlighted the precedent set by major technologies in modern computing, such as open-source computer operating systems, programming languages, and databases. Mistral AI was founded by Timothée Lacroix and Guillaume Lample, former researchers at Meta’s Paris AI lab, along with Arthur Mensch, a researcher at DeepMind, an AI lab acquired by Google in 2014 for $650 million.
Source: New York Times