Mistral AI: The OpenAI Competitor
Source: techcrunch.com
Mistral AI, the French company that created the AI assistant Le Chat and several foundational models, is considered a promising tech startup in France and possibly the only European company able to compete with OpenAI. While its valuation is $6 billion, its global market share remains relatively small. However, its chat assistant's recent launch on mobile app stores generated excitement, especially in France.
French President Emmanuel Macron suggested downloading Le Chat by Mistral instead of ChatGPT by OpenAI during a TV interview before the AI Action Summit in Paris. Although this attention is encouraging, Mistral AI faces challenges in competing with OpenAI while maintaining its identity as “the world’s greenest and leading independent AI lab.”
Funding and Mission
Mistral AI, created in 2023, has raised considerable funding with the goal of “putting frontier AI in the hands of everyone.” This slogan emphasizes the company’s dedication to openness in AI.
Le Chat, the company's alternative to ChatGPT, is now available on iOS and Android. It achieved 1 million downloads within two weeks of its mobile release and became the top free download on the iOS App Store in France.
Mistral AI also offers a suite of models, including Mistral OCR, an optical character recognition (OCR) API introduced in March 2025. It converts PDFs into text files for AI models to process more easily.
Founders and Advisors
Mistral AI’s three founders have backgrounds in AI research at major U.S. tech companies with operations in Paris. CEO Arthur Mensch previously worked at Google’s DeepMind, while CTO Timothée Lacroix and chief scientist officer Guillaume Lample are former Meta employees. Co-founding advisors include Jean-Charles Samuelian-Werve and Charles Gorintin from Alan, as well as former digital minister Cédric O.
Models and Revenue
Mistral AI distinguishes between its premier models, which are not available for commercial purposes, and its free models, which provide weight access under the Apache 2.0 license. Free models include research models like Mistral NeMo, created with Nvidia and open-sourced in July 2024.
While many of Mistral AI’s offerings are free or have free tiers, the company plans to generate revenue from paid tiers of Le Chat. The Pro plan for Le Chat, introduced in February 2025, costs $14.99 a month. Mistral AI monetizes its premier models through APIs with usage-based pricing on the B2B side. Enterprises can also license these models, and strategic partnerships likely contribute significantly to its revenue. Overall, Mistral AI’s revenue is reportedly in the eight-digit range.
Partnerships and Investments
In 2024, Mistral AI partnered with Microsoft, distributing its AI models through Microsoft’s Azure platform, along with a €15 million investment. The U.K.’s Competition and Markets Authority (CMA) concluded that the deal didn’t warrant investigation due to its small size, but it faced criticism in the EU. In January 2025, Mistral AI partnered with Agence France-Presse (AFP), allowing Le Chat to query AFP’s text archive dating back to 1983. Strategic partnerships were also secured with France’s army and job agency, shipping giant CMA, German defense tech startup Helsing, IBM, Orange, and Stellantis.
In May 2025, Mistral AI announced its participation in creating an AI Campus in the Paris region through a joint venture with UAE-investment firm MGX, NVIDIA, and France’s state-owned investment bank Bpifrance.
Funding Rounds
As of February 2025, Mistral AI has raised approximately €1 billion (around $1.04 billion). This includes debt financing and several equity financing rounds raised in quick succession. In June 2023, Mistral AI raised a $112 million seed round led by Lightspeed Venture Partners, valuing the startup at $260 million. Investors included Bpifrance, Eric Schmidt, Exor Ventures, First Minute Capital, Headline, JCDecaux Holding, La Famiglia, LocalGlobe, Motier Ventures, Rodolphe Saadé, Sofina, and Xavier Niel.
Six months later, it closed a Series A of €385 million (around $415 million), with a reported valuation of $2 billion. The round was led by Andreessen Horowitz (a16z), with participation from Lightspeed, BNP Paribas, CMA-CGM, Conviction, Elad Gil, General Catalyst, and Salesforce. Microsoft’s $16.3 million convertible investment, as part of their partnership announced in February 2024, was presented as a Series A extension, suggesting an unchanged valuation. In June 2024, Mistral AI raised €600 million in equity and debt (around $640 million). The round was led by General Catalyst at a $6 billion valuation, with investors including Cisco, IBM, Nvidia, and Samsung Venture Investment Corporation.
Future Plans
Mistral is “not for sale,” according to CEO Arthur Mensch in January 2025. An IPO is the planned path forward. Scaling its revenue to justify its nearly $6 billion valuation is necessary to dispel acquisition rumors.