Microsoft’s $16 Million Investment In Mistral AI Unveiled


Yesterday, Mistral AI, a Paris-based AI startup, made headlines with the announcement of its new large language model, Mistral Large, designed to rival OpenAI’s GPT-4. The company also revealed a distribution partnership with Microsoft, marking a significant milestone in its growth.

Key Takeaway


6 million investment in Mistral AI signals a pivotal moment in the AI landscape, with the unveiling of Mistral Large and the strategic partnership with Microsoft reshaping the competitive dynamics in the industry.

Mistral Large: A New Challenger in the AI Landscape

Mistral AI’s latest release, Mistral Large, is positioned as a formidable competitor to leading language models like GPT-4 and Claude 2. Unlike its predecessors, Mistral Large is not open source, and developers can access the model through Mistral’s proprietary API platform. This move signals Mistral AI’s strategic shift towards a more controlled distribution model for its cutting-edge AI technology.

Microsoft’s Strategic Investment and Distribution Partnership

As part of the collaboration, Microsoft has committed a substantial €15 million investment in Mistral AI, equivalent to $16.3 million at the current exchange rate. This investment is set to convert into equity in Mistral’s upcoming funding round, without altering the startup’s valuation. The percentage stake held by Microsoft will be contingent on Mistral AI’s valuation in the next funding round.

Furthermore, the partnership paves the way for Mistral AI’s models to be accessible to Azure customers through the Azure model catalog. This move not only expands Mistral AI’s reach but also provides Azure customers with an additional option within the Microsoft ecosystem, alongside offerings from OpenAI and Meta’s Llama models.

Regulatory Scrutiny and Industry Implications

Microsoft’s involvement with both OpenAI and Mistral AI has drawn attention from regulatory bodies, particularly the European Commission. The EC has expressed its intent to scrutinize the investment deal between Microsoft and Mistral AI, as part of its ongoing assessment of the relationships between major tech companies and generative AI entities.

While this strategic investment and partnership mark a significant milestone for Mistral AI, it also underscores the evolving dynamics within the AI landscape, with implications for competition, regulation, and the strategic positioning of key industry players.

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