French AI start-up Mistral reaches unicorn status

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The French generative artificial intelligence (AI) start-up Mistral AI has reached unicorn status after its latest funding round.

The company said it raised €385, valuing the company at about €2 billion, surpassing the €1 billion unicorn threshold.

The Paris-based start-up was founded seven months ago and has been widely cited as a European rival to the US AI giant Open AI.

Just 22 employees work at the start-up, which was co-founded by CEO Arthur Mensch, Guillaume Lample, and Timothee Lacroix, who have experience at Meta or Google’s DeepMind.

The former French secretary of state for digital Cedric O also sits on the company’s board.

“Since the creation of Mistral AI in May, we have been pursuing a clear trajectory: that of creating a European champion with a global vocation in generative artificial intelligence, based on an open, responsible and decentralised approach to technology,” Mensch, 31, said.

Attention from Silicon Valley

The funding announcement comes as European member states and lawmakers clinched a deal on how to draft legislation on how to regulate AI models.

The marathon talks were largely held up by France, Italy, and Germany who pushed back against what they called over-regulation, feeling it would hinder their AI start-ups.

Mistral’s value has increased more than sevenfold in six months. It raised nearly €500 million in November and €105 million in its first funding round.

It has attracted attention from the Silicon Valley venture capital firms Andreessen Horowitz and Lightspeed Venture Partners as well as tech giants such as Salesforce.

Mistral offers companies open-source language models that can be used to launch chatbots and other AI products such as search engines.

The open-source software model allows the computer code to be freely copied and reused, which gives anyone permission to build their own chatbot.

However, OpenAI and Google have warned that open-source software can be dangerous as the technology can be used to spread disinformation.

Mistral also released on Monday its latest open-source largescale language model, which it said leverages “a complex technology few companies have mastered”.