Mistral AI, which is not even a year old, is reportedly being valued at $2B.

French AI startup Mistral AI is on the verge of raising approximately €450 million ($487 million) in a funding round that values the company at around $2 billion. The funding is expected to include more than €325 million in equity from investors led by Andreessen Horowitz, which is considering a €200 million investment. General Catalyst, Lightspeed Venture Partners, Bpifrance and several others also participated.

Furthermore, Nvidia (NASDAQ: NVDA) and Salesforce (NYSE: CRM) are contributing €120 million in convertible debt. Mistral’s co-founders, as well as insiders like Cedric O, are set to sell shares as part of the deal. (Bloomberg)

The company, known for its open-source software powering chatbots and generative AI tools, has garnered significant attention, securing an initial funding round in June. A French start-up founded by former researchers from Meta (NASDAQ: META) and Google (NASDAQ: GOOGL), Mistral then raised a record-breaking €105 million (US$113.7 million) in Europe’s largest-ever seed round – when it was just four months old.

The company secured a valuation of €240 million (US$ 259.8 million), signaling investors’ confidence that Europe could indeed establish itself as a viable competitor to Silicon Valley giants like OpenAI and DeepMind.

This $2 billion valuation within a year highlights the high optimism in the tech industry regarding the potential of AI companies.

Related Story: French AI Startup Mistral Scores Europe’s Largest-Ever Seed Round

Image by Gerd Altmann from Pixabay