Mistral Raises $3.5B, Valuation Tops €21B

Mistral has raised 3 billion euros ($3.5 billion) in fresh funding as the French AI startup shifts strategy to build its own infrastructure and compete with OpenAI and Anthropic.

Mistral secures $3.5 billion led by Samsung. The company announced the round on Tuesday. It was led by memory chip giant Samsung and also included the Scaleup Europe Fund, a European Union-backed investment fund managed by EQT, and existing investor PSG Equity.

The investment gives Mistral a post-money valuation of more than 21 billion euros. The startup was valued at 11.7 billion euros a year ago after a funding round led by Dutch chip equipment maker ASML.

Funds will expand data center capacity. Arthur Mensch, CEO of Mistral, said the funding would go toward building more infrastructure, including its own data centers, and renting out computing capacity. He told CNBC that long term the plan is to fully rely on capacity that the company is building itself.

Mensch added that the amount of compute Mistral owns is going to grow around 100% in the next five years. The Paris-headquartered company develops AI models and is building out its own data center footprint.

Custom AI tools differentiate from rivals. Mistral is looking to take a different approach to OpenAI and Anthropic by working with individual companies to create custom AI tools to suit their needs and integrate them with their businesses. The CEO said the company will train bigger and faster models.

Revenue outlook exceeds prior target. Mensch said earlier this year that he expects Mistral’s annual recurring revenue to exceed $1 billion this year. With the new funding and partnerships, he expects to be beating that figure if everything happens as they are trending, though he declined to give a revised revenue figure.