10 ms·
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
by mesmertech 3y ago
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
- t8sr 3y agoThe current lack of anti-monopoly enforcement and corporate oversight in the US is a race to the bottom. Should the rest of the world compete by letting corporations run amok, acquire all competition and build monopolies? Or should they try to regulate, but risk driving away founders for whom the American legal environment is extremely lucrative? It's similar to the debate France had about raising the progressive tax rates - some ultrarich people would rather give up their French residency, than pay higher taxes. There's clearly stuff the EU could do to be more competitive, but I think the core issue is that American investors can expect less risk and bigger payoffs, because the environment is friendlier to them, but the environment being friendlier to them leads to regular people getting screwed by giant companies that operate with no oversight. Fast forward the 2020s and you literally have planes falling out of the sky. I don't think there are any great options. I'm also aware this is a fringe view on HN, kinda by definition. It's a forum for founders, mostly in the US, and the median opinion on what you should be able to do with your company on here is extreme by most peoples' standards. But the echo chamber needs some dissent on this point.
- JumpCrisscross 3y ago> Love it as a consumer because Mistral is probably not doing any more open weights if they get tangled with Microsoft The solution is to mandate open weights. Not kneecap your flagship by putting it at a permanent capital disadvantage.
- dmezzetti 3y agoTotally agree with this sentiment. I love open-source and will be on it's side to the end. But I'm not sure I want it forced upon people either. Companies should believe in the model and developers should choose companies that believe in that model.
- almatabata 3y ago> But man, as a business owner in EU, this would just make me not want to build an AI startup in EU I am not an expert but does this kind of probes not help businesses against things like hostile take overs and against VC buying up all your competitors to crush you with scale?
- nerbert 3y agoPersonally, growing a startup enough to catch the eye of EU regulators is a problem that I’d like to have.
- throwaway55671 3y agoDoing 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.
- Filligree 3y agoWhy is "exit" always the goal? Why not go on growing?
- deleted 3y ago[deleted]
- throwaway55671 3y agoPerhaps the founders want to remain there and grow, perhaps they want to focus on something else or retire. Perhaps the plan always was to sell after X years - I don't see anything wrong about that, still better to innovate&sell than just buy stock&sell IMHO. You can't attract investors if they can't sell in case the investment is successful. This is severely limiting and a terrible situation to be in - especially if you already have investors, who might demand their money back from you - way before your profits could cover it. And the worst thing that might happen - you design a startup to be acquired by Microsoft/Apple/Google and then EU comes and says no. WTF?
- deleted 3y ago[deleted]
- RandomLensman 3y agoWhy would competition law and/or national security laws not apply to a start-up or its acquirers? Why would they or their acquirers get exceptions? Would those exceptions cover patents as well on the national security? What else and why? Also, this isn't the EU saying "no" at the moment, but looking into it, as it does with many things.
- neverrroot 3y agoIt's tough, it's also part of the reason so little is done here, just compare the size of market capitalization of say DAX40 (German top 40) or CAC40 (French top 40): DAX40 $1.9T CAC40 $2.8T There are single companies in US that exceed both of these values.
- RandomLensman 3y agoBecause the European capital markets are very different with far less local money going into it, more bank funding etc. The divergence between the US and Europe there is more than 100 years old.
- gkedzierski 3y agoEURO STOXX 50 would probably be a better benchmark, which has a total market cap of around €4.0T, which is more than any single company. (your general point stands though, it's nowhere near the US market)
- Scarblac 3y agoPart of that is that you're taking a fixed number of companies. So if Europe has more, but smaller companies, the value of the top-40 would be lower than if they had fewer but larger companies. To me the first sounds healthier, everything else being equal.
- Gare 3y agoAlso, lots of large European companies are privately held. For example: IKEA, Schwartz group (Kaufland, Lidl), Bosch, Aldi...
- walthamstow 3y agoLEGO too
- anonylizard 3y agoAll 70 year old companies is not helping your point. US has new upstarts like Tesla and Nvidia, which at their prime, add like 1 IKEA per fortnight to their market cap.
- ljm 3y agoI 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.
- mnau 3y agoEU 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?
- malermeister 3y agoSAP and Spotify come to mind, more recent promising startups are this one and Stable Diffusion.
- Goodroo 3y agoThat China has a more vibrant tech scene than Europe is a real shame.
- BlueTemplar 3y agoAnd yet China's relative success is due to protectionism (or failed antitrust in USA/EU). In a "winner takes all" situation, how else can the EU compete ? (The US did protectionism too while their industries were fledgling, to avoid getting crushed by the British...)
- datbn 3y agoThis is not a winner takes all situation at all.
- api 3y agoTech is like film. Big unicorns with big exits are like the blockbuster tent pole superhero films that net hundreds of millions of dollars. You don’t have those the whole industry collapses. No art flicks or risky experiments with new ideas without Guardians of the Galaxy. It’s not just investment capital which usually grows out of exits but also the whole ecosystem of services and consultants and experts and law firms specializing in the sector. All of it. The EU doesn’t have enough routes to exit due to both regulation and a way more conservative business climate. As a result you don’t get a big tech ecosystem and most exits result in the whole thing being pulled into the US orbit.
- rsynnott 3y ago> 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 out in front on Intel and Internet Explorer back in the day).
- anonylizard 3y agoYou 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.
- IanCal 3y ago> Yet the EU prevents it from taking foreign investment all the same. No they haven't.
- geodel 3y agoTrue. In Kafkaesque sense they haven't. They are just checking things are in order.
- rsynnott 3y agoI mean, they're looking into the situation where MS keeps ~taking over AI startups. I'd be quite surprised if the FTC is not at some level also looking into this. Like, it would be weird if they weren't! At this point, no-one's telling MS it's not allowed to do this, but it would be strange if no-one was taking note of it.
- whiplash451 3y agoThis move from MSFT is clearly perceived as aggressive from EU given how fragile EU sovereignty in AI is at this point. If EU wants to own its AI future, that’s not a great way of getting started.
- pelorat 3y agoNo AI capable EU native cloud provider exists. Everything in Europe runs on Azure or Amazon. Also, EU doesn't but things for their consumers, do you even know what the EU is?
- sanxiyn 3y agoI thought EU had money a lot more than €15M (Microsoft investment), actually a lot more than €1.8B (Mistral valuation). Why didn't EU make an offer? If EU wants to own its AI future, it has enough money to buy one. They decided not to.
- wongarsu 3y agoThe EU generally doesn't act on the market like that. This isn't China or Soviet Russia after all, we are still operating under a form of capitalism. The EU does offer grants, but those are generally meant for projects that wouldn't get money on the free market
- JumpCrisscross 3y ago> EU generally doesn't act on the market like that It absolutely does. The problem is it must then partition the work across the entire continent. America has this problem, too, e.g. the F-35, but the consensus model of EU politics makes it particularly insidious.
- xprn 3y agoIs it just me that think that’s a huge catch-22? The project isn’t eligible for grants because it gets money on the free market, but is then limited by who it can come from or in what amount
- 3y ago
- mythz 3y agoTime will be the ultimate judge but Mistral's Co-founder/CEO is still committing to be a leading provider of open weight models [1]: > Clarifying a couple of things since we’re reading creative interpretations of our latest announcements: - We’re still committed to leading open-weight models! We ask for a little patience, 1.5k H100s only got us that far. - We have a reselling agreement with Microsoft, that we’re very excited about. Alongside similar partnerships, it will accelerate our growth. - Microsoft invested in a small convertible note alongside many other companies, as a distribution partner. We are an independent European company with global ambitions, that part is not changing either. > We’re seeing some interest for Le Chat and Mistral Large, on both la Plateforme and Azure, and we’ll be iterating fast! [1] https://twitter.com/arthurmensch/status/1762818733016322168 https://twitter.com/arthurmensch/status/1762818733016322168
- spidersenses 3y agoStatements like these are only a momentary snapshot. As soon as sufficiently money is at stake the board might change their tune overnight. The whole Altman-fired-from-OpenAI-then-reinstated drama should be warning enough.
- DANmode 3y agoWhat do you think they got Sam to bend the knee on, out of curiosity?
- spidersenses 3y agoIn my opinion, Altman's permanent departure would have been the death of OpenAI. After the majority of the staff threatened their resignation from OpenAI, Altman became the one holding all the leverage. I'd rather guess that OpenAI's board made him a once-in-a-lifetime offer to persuade him to come back.
- crimsoneer 3y agoI mean, the FTC would absolutely look into this agreement if you did it in the US. Regulators "looking into" things is not a thing we should be upset about, that's why they exist.
- RamblingCTO 3y agoAnd not only this, everyone loses if the FTC and the likes don't do their job properly. I'm still amazed how much "small" people argue for big entities like microsoft. You won't have these problems in your lifetime.
- janice1999 3y ago> 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.
- wallaBBB 3y agoYou think there even would be an investigation/probe into it? Perhaps a really quick one.
- JumpCrisscross 3y ago> If a Chinese company with massive government contracts had invested in OpenAI there is no way that the US would not start an investigation Sure, but if a European did we wouldn't. So if you start in America, you can access both continents. If you start in China, you can access Europe and Asia. If you start in Europe, you're limited to one. Granted, this is just a proble. But if it amounts to something, it's an asymmetrically chilling move.
- anonylizard 3y agoPretty sure the US explicitly restricts investment in Chinese AI companies now. The US has learnt its lesson investing in China too.
- JumpCrisscross 3y ago> the US explicitly restricts investment in Chinese AI companies now Congress seeks to curb it but doesn't in practice. That may change. In any case, I was discounting access to American capital market for Chinese AI start-ups: they can tap both China and Europe.
- throwaway55671 3y agoMicrosoft has massive government contracts in literally every EU country. US is an ally, not antagonist/enemy.