Something is happening with AI startups in France

last night, Motier Ventures are held a tech meetup focused on AI startups featuring some of the most hyed tech startups in the French tech ecosystem, Dust, Finegrain, Gladia, Mistral AI and Scenario – all of them portfolio companies of Motier Ventures. And you can feel a sense of excitement on stage and in the audience.

Artificial intelligence, like in the US, is quickly becoming a buzzy vertical within the French technology industry. But this time, France seems well-positioned to become one of the world’s leading AI hubs.

And this should not be surprising. Technology giants have historically set up AI research labs in Paris because there is a great talent pool of PhD students in math, computer science and engineering. They usually graduate from Polytechnique, ENS or Inria. Sometimes they move to the US for postdoctoral research and then return to France to join a research lab.

For example, Facebook (now Meta) created the Paris research lab in 2015 with Yann Le Cun at the helm of the AI ​​initiative – this research group is called FAIR, for Facebook Artificial Intelligence Research. Google is following its own AI research center dedicated to AI in Paris.

“The FAIR team is very impressive. Just look at what they have done with Llama,” a businessman told me yesterday. He recently had a private meeting with some of the engineers and scientists working on the projects. in AI.

And if you look at the founders of Mistral AIthe French AI startup working on open-source large-scale language models raised a €105 million seed round ($112 million at today’s exchange rate), all three co-founders Arthur Mensch, Timothée Lacroix and Guillaume Lample previously worked at DeepMind or FAIR at Google.

Last night, Mistral’s co-founders put together a demo of Mistral AI in a ChatGPT-like interface called Mistral AI Chat. The demo is based on a new model called “mistral-70b-instruct-alpha01”, which shows that the team is actively working on a new model with more parameters to make it more competitive with sophisticated LLM. According to a recent report from The InformationMistral AI plans to raise as much as $300 million in the coming weeks.

Mistral is not the only high-profile AI company in France. Poolside, a recent company raised a $126 million seed round, plans to use AI to make writing code easier. Founded by Jason Warner, the former CTO of GitHub, and Eiso Kant, a serial entrepreneur who works at Athenian and source{d}, the company chose Paris as its base.

DUST, a company that works to integrate large language models with internal corporate data from GitHub, Notion or Slack, also took the stage for a demo last night. At the party warming at Dust’s office, I realized that Dust has a nice office building with it Nabla, another French AI startup focused on helping doctors use large language models and co-founded by former FAIR engineers. This proves once again that an AI ecosystem is emerging.

The founders of Mistral AI and Dust had to leave the meetup immediately after their demos because they were both invited for dinner at the Elysée Palace, the residence of Emmanuel Macron. So there is also some public support for AI startups in France. An entrepreneur recently told me that many AI startups are collaborating on public tenders for government grants worth millions of euros as part of France 2030.

One thing that might differentiate European AI startups from AI giants like OpenAI and Anthropic is that they think about regulation and compliance from day one. An interesting French AI startup in this field is Giskard, which developed an open-source testing framework, or “the best LLM antivirus on the market,” as Giskard co-founder and CEO Alex Combessie told me. I will have more to write about Giskard in the coming days.

And another wave of stealth AI startups

Earlier this week, The Information reported which is Adaptive, an AI startup based in Amsterdam and co-founded by a French AI researcher Julien Launay is about to raise a seed for $100 million. Adaptive helps companies iterate their AI applications without relying on external data or annotations.

A source confirmed that Index Ventures led the Adaptive round with Iconiq and Motier Ventures participating.

Another source told me that Wiem Gharbi also raised a seed round with Index Ventures for an AI startup with a team split between Paris and London.

Image Credits: Motier Ventures

In other news, I’ve heard that Steve Morin, a key member of the team behind Zenly, a popular consumer app acquired by Snap, also created an AI startup called ZML. The team will focus on developing machine learning inference and other low-level tools.

Maxime Germainthe founder of the mental health startup Jour, which Alan acquired, left Alan to start Hands on the Heartan AI startup developing a “second brain in your pocket,” as one investor described it to me.

Pierre Valadethe founder of Sunrise and Jumbo, put together a team for an AI startup that is now called Chief of Staff. Hugo Mercier working on an AI startup in stealth mode as well.

I think it’s safe to call this new wave of startups a trend. While the overall tech ecosystem is still experiencing a downturn, there is an unreasonable amount of activity in French early stage startups with new AI startups being established at a rapid pace. speed and the VC firms fighting for the most competitive rounds of funding.

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