Samsung Electronics is in discussions to invest hundreds of millions of euros into the French artificial intelligence startup Mistral AI. This move would further solidify the market position of one of Europe's most valuable AI companies and highlights the intense global competition among tech capital for AI computing resources.
According to a report citing individuals familiar with the matter, this investment is part of a larger funding round for Mistral that is expected to value the company at approximately €20 billion. Samsung, which previously invested in Mistral through its venture capital arm, may contribute as much as €1 billion in this round. Concurrently, the Scaleup Europe Fund, managed by the Swedish investment firm EQT, is also in talks to participate. The negotiations are ongoing, and final terms have not been settled. Representatives for Samsung, Mistral, and EQT declined to comment.
These funding discussions are taking place against a backdrop of heightened demand for "sovereign AI" capabilities among European and Asian governments and corporations. This demand was spurred by recent actions from the previous U.S. administration restricting foreign access to the latest models from AI firm Anthropic. Mistral, with its "open" AI models that allow clients to freely customize and control them, is actively capitalizing on this market opportunity.
Valuation Nears 70% Increase in Under a Year, Total Funding Could Exceed €5 Billion
This new funding round comes less than a year after Mistral's previous significant valuation increase. Reports indicate the company is seeking to raise several billion euros, with the total funding round potentially exceeding €5 billion.
By comparison, less than a year ago, a deal led by the Dutch chip equipment giant ASML valued Mistral at €12 billion. Last September, Mistral completed a €1.7 billion funding round, with the majority of capital coming from ASML, which is utilizing Mistral's AI models to enhance the production efficiency of its advanced lithography machines. Earlier this year, Mistral also secured an $830 million inaugural debt financing to build data centers across Europe equipped with Nvidia chips.
The Scaleup Europe Fund, which is supported by Brussels and managed by EQT, is backed by private investors including Novo Holdings and Banco Santander. It focuses on supporting promising European companies in competitive sectors like AI.
Chip Strategy Drives Collaboration Between Parties
The engagement between Samsung and Mistral reflects the current chip supply constraints facing the AI industry. As the computational demands for AI model training and inference continue to surge, semiconductor supply is lagging behind demand growth, prompting AI developers to actively seek deep partnerships with chip suppliers.
According to an earlier report, Samsung and Mistral had previously held discussions regarding cooperation in the AI memory chip sector. Samsung is the world's largest memory chip maker and has seen its profits surge over the past year, driven by AI-fueled chip price increases.
A similar dynamic is playing out elsewhere in the industry. Last month, U.S. memory chip manufacturer Micron invested in Anthropic and signed a comprehensive cooperation agreement covering long-term memory supply.
Microsoft Expands Partnership, Providing Stable Revenue Stream
Just this week, Mistral announced an expansion of its partnership with Microsoft. As one of Mistral's earliest investors, Microsoft has committed to a "multi-billion euro" investment in Mistral's computing infrastructure. Mistral's latest models will also be made available through Microsoft's Azure cloud platform.
This deal will provide Mistral with a stable source of recurring revenue, which can serve as a credit basis for further financing. This, in turn, will help accelerate the expansion of its computing power, including the deployment of thousands of Nvidia's latest Vera Rubin chips.
Founded just three years ago, Mistral has become Europe's highest-valued AI startup. The company's Chief Executive stated earlier this year that Mistral's annual recurring revenue is on track to surpass $1 billion by year-end, an expectation based on rapid expansion among its enterprise client base.
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