Elon Musk and Mistral AI seek money to participate in the AI ​​race | Companies

The race to develop generative artificial intelligence (AI) is heating up as tech giants battle for supremacy in this technology that marked 2023 and promises to accelerate in 2024. The competition began a year ago with the launch of ChatGPT, and today three companies – OpenAI, Microsoft and Google have clearly taken the lead. . But others do not give up and press on to reach them. One of them is xAI, Elon Musk’s artificial intelligence startup, which is seeking to raise $1 billion (about 928 million euros), as revealed in a document submitted to the…

The race to develop generative artificial intelligence (AI) is heating up as tech giants battle for supremacy in this technology that marked 2023 and promises to accelerate in 2024. The competition began a year ago with the launch of ChatGPT, and today three companies – OpenAI, Microsoft and Google have clearly taken the lead. . But others do not give up and press on to reach them. One of them is xAI, Elon Musk’s artificial intelligence startup, which is seeking to raise $1 billion (about 928 million euros), as described in a document filed with the US Securities and Exchange Commission (SEC).

In the process, the CEO of Tesla and SpaceX and owner of X (formerly Twitter) is trying to maintain the pace set by his competitors. His company has already raised $134.7 million from four investors, with the first sale taking place on November 29, and has reached a “binding agreement” to sell the remaining shares (for a total of $865.3 million), as specified above. Presentation to the US regulatory body. Musk is asking investors to contribute at least $2 million.

The billionaire businessman was one of the founders of OpenAI in 2015, but left the project after three years due to disagreements with other founders such as Sam Altman. Last July, Musk launched xAI, and in November he unveiled his first AI prototype, a “satirical” chatbot called Grok, which has yet to be unveiled for the first time, although there is a waiting list to use the prototype, according to The Verge website mentioned it. guardian. Grok, who was trained on X, the social network that Musk bought for $44 billion a year ago, will be available to some of X’s premium subscribers, who pay about $16 a month.

The business mogul claimed that Grok would perform better than ChatGPT and in November got into an online dispute over the matter with Altman. “Grok is designed to answer questions with a witty touch and a rebellious side, so don’t use it if you hate humor! “Grok is designed to answer questions with a witty touch and a rebellious side, so don’t use it if you hate humor! It will also answer some interesting questions that most other AI systems refuse to do.” The entrepreneur noted last month that X investors would own 25% of XAI.

Another company that is accelerating its funding and participating in the race to generative AI is the French company Mistral AI. The company is in the final stage of raising €450 million from investors such as Nvidia and Salesforce in a financing round that values ​​the company at about $2 billion, Bloomberg reported, citing people familiar with the agreement.

This agreement includes capital of more than 325 million euros from investors led by the Andreessen Horowitz Fund, which is in talks to invest 200 million euros. The aforementioned sources added that chip maker Nvidia and software maker Salesforce agreed to provide another 120 million euros in convertible debt, warning that some details of the process may change.

The deal will come less than six months after Mistral AI raised $113 million (about €105 million), a huge sum for a European tech startup. At that time the company was valued at 240 million euros. Among its investors were the American venture capital fund Lightspeed Venture Patners, Eric Schmidt (former CEO of Google) and the investment bank Bpifrance. The latter and Lightspeed will also participate in the new round, joined by General Catalyst.

The Paris-based startup was founded in May 2023 by three 30-something AI professionals: Arthur Mensch, a former researcher at DeepMind, Google’s AI subsidiary, and Guillaume Lampel and Timothy Lacroix, both former Meta employees on charges related to this. . Technology that promises great future benefits.

The 2000 million valuation of Mistral AI, which is not even a year old, shows the optimism unleashed by AI startups. Its three founders agreed to sell more than €1 million of capital each as part of the sealed agreement, according to documents accessed by Bloomberg. Unlike OpenAI, this company, which plans to launch its first product in early 2024, is building a language model based solely on publicly available open source data (to avoid legal problems).

Generative AI companies, technology that automatically generates human-like text and images, have raised billions of dollars this year. Only OpenAI, the creator of ChatGPT, has achieved $13 billion in investment commitments from Microsoft. For its part, Google, which yesterday launched its most advanced AI model, Gemini, in October has committed to investing $2 billion in Anthropic, a startup co-founded by former OpenAI executives.

The search giant had already pumped another $400 million into this company in February, with Amazon investing $4,000 million, as announced in September. Anthropic created its own chatbot, Claude.

The boom in the emerging AI sector is also demonstrated by other Silicon Valley giants such as Meta and interest in other startups associated with this activity. Mark Zuckerberg’s company is investing billions of dollars in its own in-house AI products. Recently, American Inflection AI, another OpenAI competitor, raised $1.3 billion in a round led by Microsoft and Nvidia, ready to diversify its bets in this space.

In Europe, German company Alpha, which sells generative AI as a service, in November announced a $500 million injection, the largest fundraising by a European AI company to date. The operation was led by a group of German companies: Schwarz Group (owner of Lidl supermarkets), Bosch, SAP and Burda Principal Investments.

The fundraising efforts come after OpenAI’s recent crisis, which exposed the startup’s governance problems. Some voices are already warning of the risk of a potential AI bubble, but others are ruling it out.

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