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Europe probes Microsoft's €15M stake in AI upstart Mistral

theregister.com

41–50 of 135 posts

Re: Europe probes Microsoft's €15M stake in AI upstart Mistral

#41

Love it as a consumer because Mistral is probably not doing any more open weights if they get tangled with Microsoft. But man, as a business owner in EU, this would just make me not want to build an AI startup in EU

> But man, as a business owner in EU, this would just make me not want to build an AI startup in EU Like, purely on the basis that MS might not be allowed to take you over? TBH I'd assume the FTC would at least be asking questions here, too. EC and FTC thinking on competition is generally not all _that_ different, but the EC tends to be quicker to act these days (this was not always the case; the FTC was very much ou…

You don't own what you can't sell. Any asset value will be massively reduced if its untransferable.

Mistral isn't exactly some decade-long state funded national champion. Its a 1 year old startup whose core staff all come from American tech companies. With 0 revenue and minimal market share, there's like no conceivable metric in traditional antitrust theory to block this. Yet the EU prevents it from taking foreign investment all the same.

Look at TSMC in comparison. It IS the national champion of Taiwan, yet its majority foreign owned, doesn't stop it from underpinning the Taiwan economy and spawning massive ecosystems in its local areas.. Taiwan's government understands its place in the international economy, so prefers to cooperate and trust its international partners.

Re: Europe probes Microsoft's €15M stake in AI upstart Mistral

#42

Earlier quoted context omitted.

Doing all the work and taking all the stress only to have the EU remove a chance of growth and exit is a problem that I never want to have. I went through some failed startups, and at least that was our own fault, but still I never want to do that again. I don't know what I'd do in this situation.

Why is "exit" always the goal? Why not go on growing?

Because speculative startups require a lot of investment/venture capital, but the VCs need a defined return at some point. They need an exit with a sale, an acquisition or an IPO in order for the whole process to make financial sense. If companies just 'grow' but never sell out, there's not enough return for VCs, so they don't invest. No investment = way less startups to begin with

Re: Europe probes Microsoft's €15M stake in AI upstart Mistral

#43

Earlier quoted context omitted.

385M USD is way too much for EU investors. They usually invest 10x-100x less. So the alternative without US investors would be to have no startup of this kind - great job, that will really help EU grow!

What makes US investors so uniquely ambitious and generous? I'm starting to appreciate the US financial sector more and more.

Le privilège exorbitant ...

Re: Europe probes Microsoft's €15M stake in AI upstart Mistral

#44

To be frank, I am more worried about the fact that they raised $385M from US investors at the seed stage. That speaks volume about how much it really is an EU company. Good luck to EU for retaking control of this ship.

385M USD is way too much for EU investors. They usually invest 10x-100x less. So the alternative without US investors would be to have no startup of this kind - great job, that will really help EU grow!

Let’s fix the root cause instead of leaning in to a subpar EU investment funnel.

EU has billions to invest in AI. I don’t buy that EU has “much less money than the US”.

Re: Europe probes Microsoft's €15M stake in AI upstart Mistral

#45
post #31

Earlier quoted context omitted.

Why is "growing" always the goal? Why not go on sustaining?

Because sustaining is a job, and it's a very hard job. The shareholders might not like that job or want to do a different one, or they just can't do it. Or the market is going down, but someone could use the IP/assets/team.

> Because sustaining is a job, and it's a very hard job.

... and infinite growth is neither of those?

Re: Europe probes Microsoft's €15M stake in AI upstart Mistral

#46

Earlier quoted context omitted.

> But man, as a business owner in EU, this would just make me not want to build an AI startup in EU Like, purely on the basis that MS might not be allowed to take you over? TBH I'd assume the FTC would at least be asking questions here, too. EC and FTC thinking on competition is generally not all _that_ different, but the EC tends to be quicker to act these days (this was not always the case; the FTC was very much ou…

You don't own what you can't sell. Any asset value will be massively reduced if its untransferable. Mistral isn't exactly some decade-long state funded national champion. Its a 1 year old startup whose core staff all come from American tech companies. With 0 revenue and minimal market share, there's like no conceivable metric in traditional antitrust theory to block this. Yet the EU prevents it from taking foreign in…

It's not about antitrust. It's about national security.

Re: Europe probes Microsoft's €15M stake in AI upstart Mistral

#47
post #7
post #5

Earlier quoted context omitted.

I imagine there has to be some kind of security implication here, the same reason why the US is restricting the export of AI chipsets to china. It's not ideal if US megacorps are heavily investing in or buying out EU AI startups.

EU has to tech scene, so it doesn't want a potentially successful project to be transferred to US. What is the most biggest EU software company? SAP?

As someone who has spent the last 30 years in European tech companies, mostly startups, that is news to me.

Europe does not tend to produce as large tech startups as the US, in part because a lot of promising companies leave for Silicon Valley first chance they get because funding opportunities are better there. But then neither does most of the US, partly for the same reason.

We see the same all the way down - when I worked in a UK based technology VC, we saw both people decamping from the regions to London, and from London to SV for these kinds of reasons, as well as an influx of tech companies from all over elsewhere in Europe who saw London as one of a short list of European cities to move to in order to make things easier - some of whom undoubtedly would move on to SV.

I myself moved to the UK 24 years ago because I co-founded a startup in Norway, and the VC's that invested in us adviced us to move the company to London because there was insufficient capital for tech/software companies in Norway at the time.

Europe has plenty of tech. Tech is not all, or even mostly, the tech giants. It could have more, and it could put more effort into keeping more here. But regulations will not be enough for that - it'll take more capital infusion.

Re: Europe probes Microsoft's €15M stake in AI upstart Mistral

#48

Earlier quoted context omitted.

> But man, as a business owner in EU, this would just make me not want to build an AI startup in EU Like, purely on the basis that MS might not be allowed to take you over? TBH I'd assume the FTC would at least be asking questions here, too. EC and FTC thinking on competition is generally not all _that_ different, but the EC tends to be quicker to act these days (this was not always the case; the FTC was very much ou…

You don't own what you can't sell. Any asset value will be massively reduced if its untransferable. Mistral isn't exactly some decade-long state funded national champion. Its a 1 year old startup whose core staff all come from American tech companies. With 0 revenue and minimal market share, there's like no conceivable metric in traditional antitrust theory to block this. Yet the EU prevents it from taking foreign in…

You would have an anti-trust problem if somebody went out and bought all of the promising AI startups.

So at what point in their buying spree do you cut them off? Do you wait until they've bought 90% of AI startups? 50%? Does it matter if there are 4 AI startups or 40?

Re: Europe probes Microsoft's €15M stake in AI upstart Mistral

#49

Love it as a consumer because Mistral is probably not doing any more open weights if they get tangled with Microsoft. But man, as a business owner in EU, this would just make me not want to build an AI startup in EU

> But man, as a business owner in EU, this would just make me not want to build an AI startup in EU

If a Chinese company with massive government contracts had invested in OpenAI there is no way that the US would not start an investigation.

Re: Europe probes Microsoft's €15M stake in AI upstart Mistral

#50

Earlier quoted context omitted.

Doing all the work and taking all the stress only to have the EU remove a chance of growth and exit is a problem that I never want to have. I went through some failed startups, and at least that was our own fault, but still I never want to do that again. I don't know what I'd do in this situation.

Why is "exit" always the goal? Why not go on growing?

> Why is "exit" always the goal?

The goal should be whatever the creator wants.

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