In an interview with the Financial Times, Xavier Niel said Europe had options other than relying on big US firms for AI
Xavier Niel, the French telecoms and tech entrepreneur and billionaire has said Europe can holds its own in AI, so long as start-ups’ founders don’t cash out too early. He said he believes that the continent can compete against US giants’ multi-billion dollar investments and foundation models, according to an interview with the Financial Times [subscription needed] published over the weekend.
He was quoted saying, “I think we can create big things with a few hundred million euros”. Niel backed the French AI firm Mistral, which has a valuation of €6 billion a year after it was founded. However, he thinks the crucial phase in the next two or three years, and depends on the number of initiatives and “the real geniuses” who are building the best companies avoiding being swallowed up or selling out too quickly.
He warned, ““Founders need to realise that if a bigger company is offering to buy them at X value then it is probably worth 2 or 3 times that.” He also stressed that AI will not have a single winner, but “dozens or even hundreds”.
Niel has pumped about €500 million into France’s AI ecosystem and has said he could eventually contribute billions. This includes supporting a non-profit research lab called Kyutai whose aim is to create open-source AI models. The project has attracted Google’s former CEO, Eric Schmidt.
As the FT rather pithily observes, “Such optimism about European tech is notable given that the continent lost to US and Chinese giants during previous waves of disruption from the internet to social networks, leading the region to distinguish itself more on regulation than innovation.” Arguably much of that regulation in the telecoms sphere has done more harm than good to boot.
The French tycoon warns that if Europe fails to grasp this opportunity, it will “become a very small continent, abandoned for a few generations”.
Niel is involved in telecoms businesses in 23 countries with more than 110 million subscribers collectively. His fortune comes from having founded (in 1990) and controlling the Iliad Group, which offers no-frills telecoms services in Poland, France and Italy. It is successful and growing rapidly when many other telcos’ revenues are stalled or in decline.
Days ago it published its Q3 earnings: its consolidated EBITDAaL for the first nine months of 2024 rose steeply to €2.89 billion, with growth of 13.6%2 for the nine-month period and 14.3%2 in the third quarter.
His investment vehicle Atlas Investissement holds a 29% stake in Millicom which has operating companies in the Caribbean and Latin America. He has made so far unsuccessful attempts to gain 100% ownership of the group.
Scaleway, Niel’s cloud infrastructure company, runs one of the biggest supercomputers in Europe’s private sector. He also sits on the boards of the asset investment fund KKR and TikTok’s owner, ByteDance.
Niel, who is 57, has had a colourful life so far, including trying his hand at hacking and a month in jail. He recently published his autobiography, and said he has political ambitions. His personal fortune is estimated at €10 billion.