Mistral AI is in discussions with investors about raising approximately €3bn ($3.5bn) at a potential valuation near €20bn ($23.2bn), Bloomberg reported citing people familiar with the development.
These discussions are said to be in the early stages, and the terms could change, with valuation figures potentially rising based on investor interest.
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Sources declined to be identified, citing the private nature of the negotiations.
Mistral hit a valuation of €11.7bn following a fundraising round in September last year.
At that time, ASML, which became the French AI company’s largest shareholder, invested €1.3bn for an 11% stake.
Mistral, which focuses on developing open-source large language models (LLMs), was established in 2023 by researchers with experience at Google DeepMind and Meta Platforms. The French start-up markets itself as a European alternative in the global AI sector, which is dominated by US and Chinese firms.
The company has also concentrated on serving as an infrastructure provider for European governments and businesses, developing cloud-computing facilities it will operate in France and Sweden.
Mistral has recently promoted its AI services towards engineering and manufacturing, securing agreements with companies such as Airbus and BMW.
Despite these partnerships, the adoption of Mistral’s AI models and chatbot has so far been lower among businesses and consumers. This is compared with rivals OpenAI and Anthropic, as well as several Chinese technology firms, according to Bloomberg.
Reports indicate that Mistral has been pitching a product to European banks and institutions as an alternative to Anthropic’s Mythos model, which specialises in identifying cybersecurity vulnerabilities.
Mistral’s investors have included French state bank Bpifrance and certain US venture capital firms, among them Lightspeed Venture Partners, General Catalyst, and Andreessen Horowitz.
Last month, Tata Consultancy Services (TCS) entered into a strategic agreement with Mistral to deliver AI solutions to businesses worldwide. The agreement makes TCS the first global systems integrator for Mistral Forge, an enterprise platform that lets companies build AI models using proprietary and domain-specific data.
Mistral also acquired Emmi AI, an Austrian deep tech startup, in May, in a move to expand its services for industrial clients across Europe.
