Valued at €2 billion, French start-up Mistral AI has been billed as one of Europe’s great hopes in the escalating commercial battle over artificial intelligence (AI). Can the Paris-based outfit — founded in April 2023 by three former researchers at Google and at Facebook’s parent company Meta — find a place in a market carved up by the Silicon Valley giants? Alongside German company Aleph Alpha, Mistral has caught the eye of key investors on both sides of the Atlantic, hauling in upward of €500 million in last year’s funding rounds from the likes of veteran venture capital firm Andreessen Horowitz or French billionaire Xavier Niel. Headed by the photogenic Arthur Mensch, a graduate of the elite École Polytechnique, the company was one of France’s star guests at this winter’s rendition of the World Economic Forum in Davos. Has Emmanuel Macron’s “start-up nation” finally found its champion?

Perhaps not. The rosy, David-versus-Goliath story surrounding Mistral’s rise was undercut in late February when it was announced that the firm sealed a partnership with Microsoft. The US behemoth already has a commanding stake in the burgeoning AI industry through its $13 billion investment in OpenAI, whose ChatGPT is already positioned as the dominant platform in the field of generative, general-purpose AI. Valued at just $16 million, Microsoft’s capital infusion in Mistral is tiny by comparison, but it points to a pattern that has upset European efforts at cultivating autonomous tech hopefuls. For these latter inexorably feel the gravitational pull of the backlog of investable capital held by US firms — and the technological and distribution infrastructure that businesses like Microsoft can offer.

Max von Thun, Europe director at the Open Markets Institute, told Jacobin that the new partnership between Microsoft and Mistral AI is symptomatic of the “huge structural concentration that you see in the tech sector, which is not new, which has been around for a long time, but which has basically put the big tech companies in a position to essentially co-opt or neutralize any potential players in AI who might challenge them directly.”