$14 billion AI startup Mistral — Europe's answer to OpenAI — lands French military deal as the region bets on homegrown tech
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- France's military signed an AI deal with $13.6 billion startup Mistral to boost defense tech.
- Mistral's AI will run on French infrastructure as Paris pushes military data sovereignty.
- The deal positions Mistral as Europe's homegrown alternative to US AI giants like OpenAI.
French AI startup Mistral has secured a major vote of confidence from its home government after landing a deal to provide AI technology to France's military.
France's Ministry of the Armed Forces said on Thursday that it has formally notified a framework agreement with Mistral AI, giving the country's armed forces, defense agencies, and affiliated public institutions access to the company's advanced AI models, software, and services.
Under the deal overseen by the ministry's defense AI agency, Mistral's AI systems will be deployed on French-controlled infrastructure, a key priority for the military as governments grow increasingly cautious about where sensitive data is processed and which laws govern it.
In a LinkedIn post announcing the deal, Mistral said its AI systems would be deployed on France's own infrastructure and fine-tuned using defense-specific data to support operational military needs.
The financial terms of the deal have not been disclosed. Mistral was not immediately available for comment when contacted by Business Insider.
The agreement marks a significant win for Mistral, which was founded in 2023 and is valued at roughly $13.6 billion, following a 1.7 billion euro ($2 billion) funding round announced last year.
The startup has positioned itself as a European alternative to US AI heavyweights, such as OpenAI, Google, and Anthropic, pitching its models as powerful yet more compatible with Europe's sovereignty and data control ambitions.
In its statement, translated by Business Insider, the defense ministry said the partnership is intended to strengthen France's "technological sovereignty" and ensure the armed forces maintain control over critical AI tools used across military operations and administration.
Bertrand Rondepierre, director of the ministry's defense AI agency, said the agreement represents "a major step" in strengthening the ministry's generative AI capabilities and preparing the armed forces for future challenges, while maintaining sovereign control over the technologies used.
The deal comes as European governments reassess their dependence on US technology in strategic sectors ranging from cloud computing to semiconductors and now AI.
The French ministry's move mirrors that of the US government, which has increasingly inked major contracts with domestic AI companies to develop tools for military and national security use, including recent deals with OpenAI, xAI, Anthropic, and other defense-focused startups.
As generative AI becomes increasingly embedded in military planning, logistics, and analysis, Mistral's latest win helps to position the startup as one of Europe's key players in the race to develop sovereign alternatives to American tech giants.
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