Sifted - Mistral and Helsing tie the knot

Good morning there,

We had a very busy first day in Paris, with the AI Action Summit giving us multi-billion euro investments, surprising startup partnerships and a whole crop of data centres all in the space of a few hours in the morning. 

Then we managed to dig up the details on French AI darling Mistral's steady pivot into defence tech, with sources telling us the company has been pitching its technology's military applications to individuals close to the British, French and German governments. 

After taking a breather, we also asked what French president Emmanuel Macron's €109bn Stargate-like announcement means for the country's AI ambitions. (Phew)

If you're in the French capital for day two today, we’ll be wandering around Station F. Feel free to drop either of us a line (names linked below) if you want to meet up!

Elsewhere today: 

• German VCs speak out ahead of snap election: ‘The time to be non-political is over’
• Inside the hacker hotel digging for Europe’s first trillion-dollar company
• All you need to know about AI agents

— Martin Coulter, news editor & Daphné Leprince-Ringuet, senior reporter

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🪖 French AI startup Mistral is pursuing defence contracts with governments across Europe, pitching its technology’s potential military applications to officials in the UK, France and Germany, sources tell Sifted.

• The LLM maker also had a busy start to the AI Action Summit which kicked off in Paris yesterday.
• It announced it has signed a partnership with German defence tech Helsing to develop large language models for defence, and that it’s investing ‘several billions of euros’ to build its own data centre in France.

🏗️ Swedish cloud startup Evroc is going big on data centres too. It unveiled plans to build a hyperscale data centre in Mougins, just over 500 miles south of Paris, as it hopes to become the European alternative to American cloud providers such as AWS.

• That facility will house around 50k GPUs and is set to be up and running later this year. Reaching full capacity will require around €4bn, according to the company.

💰 20 key investors will deploy €150bn into European AI over the next five years under the banner of the “EU AI Champions Initiative”, which aims to simplify European regulation, increase investment in AI infrastructure and help the public better understand and trust the tech.

• Dozens of major corporations, VC firms and startups have rallied behind the plan, which is being led by US VC General Catalyst.

🏩 The first rule of Finland’s new hacker hotel: there are no rules. The tech bootcamp located on Aalto University’s campus in Espoo (15 miles west of Helsinki) is run by two university dropouts who provide what they say are six essentials to get the synapses firing: a roof over your head; 34 inch computer monitors; LED lights; food; caffeine and nicotine. 

• As this is Finland, there’s also a sauna. After that, it’s up to you. There are no classes: anyone admitted to the hacker hotel is free to do as they please, so long as their aim is higher than developing B2B SaaS. 

📣 German VCs are ramping up their political activism, courting sympathetic lawmakers and pushing them to adopt a startup-friendly agenda. Investors told Sifted they’ve been hosting fundraisers and publicly endorsing political parties.  

💰 What France’s Stargate-style €109bn announcement means for its AI ambitions.

✈️ Airport or amusement park? Three French transportation and aviation startups to watch. (Sponsored by Groupe ADP)

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AI agents: licence to kill SaaS startups

• “Agents are getting more powerful every single week, if not every day, and we’re going to have very general agents in a year or two,” says Marvin Purtorab, cofounder and CEO of London-based Convergence AI, the AI agent-maker that raised Europe’s largest pre-seed round of 2024 (a $12m deal led by Balderton Capital).
• The nascent technology is already making slow inroads into customer service and sales functions. Soon there’ll be agents for more advanced applications in healthtech and research.
• Our latest Pro briefing covers the suddenly-ubiquitous AI agent startup — we’ve got every VC fundraise there’s been in Europe to date. 

Pro subscribers can access an entire library of briefings. Interested in a subscription? You can learn more here.

Munich, Germany-based Finn, a car subscription platform, raised up to €1bn in debt funding. Citi and Jefferies led the round and were joined by investors including Avellinia Capital.

Toulouse, France-based Reev, which develops wearable robotics for mobility assistance, raised $9.2m in funding. Newfund Heka, Polytechnique Ventures and Irdi Capital led the round and were joined by investors including Techstars, Raphael Varane and Herve Silbert.

Stockholm-based Recarber, which develops and finances carbon removal projects, raised €5.1m in funding. Luminar Ventures, Spintop Ventures and Course Corrected led the round.

Cologne, Germany-based Planted, which develops AI software for ESG management, raised €5m in seed funding. TechVision Fonds, Wenvest Capital, Neoteq Ventures, Aws Gründungsfonds and Smart Infrastructure Ventures participated in the round and were joined by angel investors including Nina Kani, Felix Schürholz, Frank Piotraschke, Arno Nonnen and Julius Göllner.

Madrid-based Nido, a heat pump technology platform for the residential sector, raised €5m in seed funding. Iberdrola, Ship2B Ventures, Zubi Labs, Decelera Ventures and Silence VC participated in the round and were joined by institutional investors including Instituto Valenciano de Finanzas and Enisa.

London-based Composo, which evaluates the accuracy and quality of LLM-powered apps, raised $2m in pre-seed funding. Twin Path Ventures led the round and was joined by investors including Jvh Ventures and Ewor.

Bratislava-based Culturepulse, which provides AI insights for high-risk decision making, raised €1.45m in Series A funding. Rockaway Capital led the round.

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