The return of French Tech
- French president Emmanuel Macron says he wants to turn his country into a “nation of start-ups”.
- Zenly, the app which lets you find your friends 24/7, has raised more than some major players in Silicon Valley.
The young employees are glued to their laptops, having a confab on the coloured poufs or playing foosball. No doubt about it, this is a start-up incubator. But this one feels more like a cathedral. Located in a former railway station in the centre of Paris, Station F is 310 metres long and covers 34,000 m², equivalent to nearly seven football pitches. Inaugurated at the end of June, it will become home to 1,000 start-ups. The project was started by media magnate Xavier Niel, who funded the entire €250 million cost.
Station F stands out not just for its size. “We surveyed hundreds of start-ups in order to identify their needs”, explains Roxanne Varza, director of Station F. The “campus” brings together a multitude of stakeholders under the same roof: 20 start-up programmes managed by partners from different industries (including data, artificial intelligence, gaming, fintech, healthtech and cyber-security), three large international investment funds, a “techlab” where new businesses can create prototypes and administrative counters where the start-ups can carry out formalities. Cafés, restaurants and three residential towers in suburban Ivry will soon complete Station F’s offering.
Station F has sparked considerable excitement and added to the enthusiasm following the election of Emmanuel Macron, the new president who has said he wants to turn his country into a “nation of start-ups”. At the inauguration of Station F, Macron compared his election to the founding of a company.
Station F in Paris
1,000 start-ups: Station F in Paris, inaugurated in June 2017, is the biggest space for young entrepreneurs in Europe.
Alignment of the stars
“Macron has re-energised the local ecosystem,” says Varza. “His pro-business, pro-tech message is understood on the entrepreneurial scene. Brexit, the election of Donald Trump and the eye-watering prices in Silicon Valley are getting young entrepreneurs interested in France. Many of the start-ups that have applied to join Station F have mentioned these reasons for their applications. The majority of candidates are from the US and UK.”
Jean-François Caillard, operations director at start-up accelerator NUMA, praises an “alignment of the stars”. “France, which was seen as highly resistant to change, weighed down by taxes and not very innovative, is suddenly projecting a positive image,” he says. To be fair, international perceptions did not always reflect reality in recent years. France did not wait for the arrival of President Macron to start producing success stories. BlaBlaCar, the carsharing platform, Sigfox, the IoT specialist, and the preowned fashion resale site Vestiaire Collective are just some of the most emblematic examples.
Start-ups and capital
At the same time, raising funds has become easier. Devialet, the high-end speaker manufacturer whose products are based on digital-analogue hybrid technology, completed a round of €100 million in 2016. The company attracted investment from large groups like Renault and Foxconn, investment funds and even Jay-Z, the US rapper-businessman. Thanks to this capital inflow, Devialet, which launched its first products four years ago and has filed 108 patents, is now preparing to break into new markets, such as the automotive and television industries.
Amongst the projects that are whetting appetites is Zenly, the app which lets you find your friends 24/7. Since the product’s launch in mid-2016, the start-up has raised more than $30 million, much of it from major players in Silicon Valley. What sets it apart is precise geolocation and low battery consumption. In July 2017, Zenly was taken over by Snapchat’s parent company for $200–$250 million.
It didn’t happen overnight
“The French start-up world has made enormous strides in the last five years,” says Caillard, “and it didn’t happen overnight.” He cites the significant funds injected into the ecosystem by government agency Bpifrance as one of the main factors behind this metamorphosis. It invested €191 million in54 start-ups in 2016, a 13%increase over 2015. This figure is expected to reach €218 million in 2017. The government’s creation of the “French Tech” label in 2013 has also contributed to the positive dynamic. Start-up incubators and accelerators have increased in number throughout the country and are now more professional than before.
The new generation’s spirit is also decisive. Creating a start-up is now an option considered by one in two graduates, and business founders are no longer hiding their ambitions. “The French ecosystem was lacking the communication vehicle it needed to really shine,” says Caillard. “This is what Emmanuel Macron does so well.”
High marks for France
If proof was needed of France’s economic dynamism, it came from Deloitte’s Fast 500 Europe ranking. The largest number of quickly growing start-ups, 94, came from France, vs. 70 from the UK and 23 from Germany. According to the audit and consulting firm, the French start-up ecosystem grew by 1,300% between 2012 and 2016.