French startup Mistral rolls out app in escalating AI race

By Florence Loeve

PARIS (Reuters) - Nvidia-backed French startup Mistral AI rolled out a new app for its generative AI software on Thursday, hot on the heels of last month's launch of a new AI assistant by China's DeepSeek.

The little-known Chinese company rocked global markets by showing it could go head-to-head with U.S. heavyweights in the field, while charging much less.

Paris-based Mistral AI, founded two years ago, says its open source Le Chat assistant is powered by the world's fastest inference engines, responding with up to 1,000 words per second.

Its launch is well-timed, with a focus on alternatives to OpenAI's ChatGPT and days before Paris hosts an AI summit.

"The French and the whole world are realising that European players count and that they provide cutting-edge technology," Mistral AI CEO and co-founder Arthur Mensch told Reuters.

Mistral AI, which is reported to be valued at 5.8 billion euros ($6.01 billion), won financial backing from AI chip leader Nvidia and is often touted by French President Emmanuel Macron.

Despite early success, it has been overshadowed by the popularity of ChatGPT, which had 200 million weekly active users, said OpenAI in August, compared with "several million subscribers" regularly using Le Chat, Mensch said.

Mensch, 32, said he knows DeepSeek well and was not surprised by its latest innovation. DeepSeek had benefited from technology shared by Mistral via open source in 2023, he said.

"DeepSeek is something we've been waiting for," he said, adding: "We are a company that builds products on open source solutions. So whenever there is new open source technology, we benefit from it."

Mensch highlighted a need for a European alternative to Chinese and American offerings, saying that his ultimate goal was to make AI "more open and more accessible to everyone".

"There is a cultural dimension to AI, and I think everyone is starting to realise this. It's also about having European champions, and that's why we created Mistral," he said.

Mistral's new chat assistant, previously only available on a web browser, is the mainstream version of a product also being offered to businesses.

The company says it has already signed partnerships with "several dozen" large companies, including with French water and waste management group Veolia.

Mistral AI also announced a partnership with the French jobs agency earlier in the week and has more in the pipeline with other European authorities, said Mensch.

However, that represents a fraction of the partnerships won by U.S. heavyweights, who are also set to benefit from President Donald Trump's Stargate project.

Mensch said Mistral AI, which has raised more than 1 billion euros to date, was "very well-funded".

Commenting on speculation about an IPO, he said that it was "not a short-term ambition at all".

($1 = 0.9651 euros)

(Reporting by Florence Loeve; Editing by Dominique Patton and Alexander Smith)