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Xavier Niel's Plot To Win AI For France

The French startup godfather has assembled an unlikely crew of fellow billionaires to support his plan to make the nation a GenAI epicenter.

France's Three GenAI Musketeers are the unlikeliest of companions.

Xavier Niel is the Daddy Warbucks of French tech, writing countless checks with a stupefying number of Zeroes for too many initiatives to count. He is now bankrolling France's AI ambitions with €200 million that he found under the couch cushions at home. That money is going toward his cloud computing company Scaleway for a supercomputer, a non-profit AI research center, and a fancy ai-PULSE conference hosted by Scaleway (his cloud computing company) at Station F (the startup campus that Niel built).

At said conference this month, Niel officially announced the details of the AI research center that henceforth shall be called Kyutai, which means "sphere" in Japanese. But as the French media helpfully pointed out, when spoken out loud it sounds a bit like: "cute AI" (« jolie IA », en anglais). (FWIW: That's not a great translation. "Cute" is more like "mignon," but whatever.)

Kyutai is being started with €300 million, of which €100 million came from Niel. Given the astronomical costs of computing power, that should keep the lights on for a few months. At the conference, we got to meet the other two major benefactors, who appeared on stage with Niel.

Benefactor Number Two is Smooth Operator Rodolphe Saadé, chairman of shipping giant CMA CGM (which as you no doubt know stands for Compagnie Maritime d'Affrètement et Compagnie Générale Maritime). This Franco-Lebanese bazillionaire is making a bid to be French tech's new Sugar Daddy. In addition to pumping €100 million into Kyutai, he's invested with Niel in GenAI startups Poolside and Mistral AI. He's betting that AI can bring sexy back to shipping.

And finally, Musketeer Number 3 is Eric Schmidt. The former CEO of Google is King of the Silicon Valley Libertarian Bros, a man who has never met a government regulation he didn't hate. A decade ago he was battling the French government over threats to impose a tax on Google to compensate French media. He also has come to loathe the suits in Brussels thanks to the multiple anti-trust legal actions that EU regulators have lodged against Google over the years. Getting him up on stage to sing the praises of France's innovation prowess is certainly a surprise. Though, true to form, he couldn't resist taking a swipe at European regulators: "The problem is you're stuck in Europe with Brussels. And so you've got this weird regulatory structure, which makes no sense starting with the AI EU act. So the way this is going, the way France will win is if Brussels is kept under some level of control...Sorry, I'm an American, I can just be obnoxious."

Obnoxious American. That is a concept that every French person understands.

Somehow, Niel pulled this motley group together to fund Kyutai (the amount of Schmidt's financial contribution was not disclosed) which has recruited 6 top AI research dudes (all dudes) to do basic research on open-source language learning AI models. This has become Niel's new cause célèbre: Creating AI that respects privacy and sovereignty so France can control its digital destiny and not perpetually be under the thumb of those aforementioned Obnoxious Americans.

"We started to talk about this project together a few months ago," Niel said in his keynote address. "With the idea of creating something different, a nonprofit in France, in Europe, to help the ecosystem because we were thinking that we will use AI in our life in the following years. We want to have models which could be created in Europe and have these models open. We know we have the best talent in Europe and in France."
Athos, Porthos and Aramis

France And AI Sitting In A Tree...

France has been making a bid for AI glory in a concerted way ever since the government announced a 5-year national strategy in 2018 backed by €1.5 billion. President Macron unveiled Part Deux of that strategy earlier this year when he announced another €500 million for a range of AI programs, including creating several AI research clusters around the country and programs to help businesses adopt AI.

In The Spotlight: Macron Explains France’s AI Strategy At Viva Tech
During a 16-minute response to a question about AI, the French president outlined the nation’s strategy and the stakes.

Macron made an appearance by video at XavierFest to praise the latest AI efforts and to emphasize again how important the tech is to the future of France.

"The first building block is our technological sovereignty," Macron said. "For our voice to be heard, France must first have the companies and talent that count...
It's about moving faster on computing infrastructures. And so, we're going to accelerate on the public side, but we need the mobilization of the private sector."

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