French AI startup Mistral AI raises €105 million, a record for Europe

Launched four weeks ago in Paris, the AI project Mistral AI raised €105 million in a seed round. The amount was a record for this stage of funding in Europe, according to the Financial Times.

According to the publication’s sources, the startup was valued at €240 million following the round. Journalists say the size of the investment reflects the AI boom and Europe’s desire to create a viable alternative to Silicon Valley giants such as OpenAI, backed by Microsoft, or Google’s DeepMind.

“There is growing awareness that this technology is transformative, and Europe needs to do something with it both as regulator and as customer and investor,” said Mistral AI CEO Arthur Mensch.

A former DeepMind researcher founded the firm together with Timothée Lacroix and Guillaume Lampe, former Meta employees.

The funding round for the startup was led by Lightspeed Venture Partners. Among the investors: former Google CEO Eric Schmidt, billionaire Xavier Niel, and the French state investment bank Bpifrance.

Mistral AI does not yet have a ready product. The first employees started work at the company a few days ago.

In early 2024, the startup plans to launch a “large language model” akin to the “generative AI” behind the ChatGPT app.

According to Lightspeed partner Antoine Moiru, the amount and pace of the funding reflect the founders’ skills, who are just over 30 years old.

“There are 80-100 people worldwide with the same level of experience as they have. For better or worse, but now the capital requirements in the computing and top-talent space make launching an AI startup a fairly capital-intensive game,” he said.

Earlier in June, the London-based decentralized compute AI network Gensyn raised $43 million in a Series A round.