Smaller AI companies must band together, argues Joëlle Pineau, chief AI officer at Canadian startup Cohere. Without consolidation, no credible challenger to the American and Chinese model builders will emerge.
Her comments come just over a week after Cohere signed a merger agreement with Aleph Alpha, the German AI startup. The partnership signals a broader push for European and Canadian firms to pool resources and compete on infrastructure, talent, and compute.
Pineau told Sifted that smaller players outside the US and China need to join forces to create viable alternatives. She pointed to the deep pockets of OpenAI and Anthropic, alongside Google’s Gemini and Meta’s Llama, as the dominant forces shaping the market.
“If you think about the resources needed to catch up to OpenAI or Google or the US leaders, there is no way for small players to do it alone,” Pineau said.
Meanwhile, the financial gap keeps widening. OpenAI recently raised $6.6bn at a $157bn valuation. Anthropic, for its part, secured a $4bn investment from Amazon. These numbers dwarf what most European and Canadian startups can access.
The funding imbalance has pushed several companies to seek mergers. Aleph Alpha, for example, has shifted toward an enterprise software focus after raising $500m in 2023. Around the same time, French startup Mistral AI raised €450m at a €2bn valuation.
“Small players need to find synergies,” Pineau said. “We have complementary strengths, and by combining them, we can offer an alternative to the US giants.”
She described the Cohere-Aleph Alpha deal as a “natural fit.” Both companies target enterprise customers rather than chasing consumer chatbots. That shared focus, she argued, gives the merger a practical foundation.
“We are building a European and Canadian AI champion,” Pineau said. “The goal is to give enterprises a real choice when they look for a trusted AI partner.”
The merger also reflects a rising demand for AI sovereignty. European governments and businesses increasingly want models that respect local data rules and reduce dependence on American platforms. Cohere and Aleph Alpha position themselves within that movement.
Pineau acknowledged the road ahead remains difficult. Building frontier models costs billions, and the competitive pressure from Silicon Valley shows no sign of easing. But she insisted the merger creates a stronger foundation.
“It’s a long-term play,” she said. “We are not trying to win the race in three months. We are building something sustainable.”
