Read the full article on Medium Here
Bartosz Jakubowski of EQT Ventures is a veteran observer of the French tech scene (he is the man behind an often cited chart of the French Tech startup ecosystem). In fact, he is more than an observer. He is a Paris venture capitalist whose firm, the venture arm of Sweden’s EQT Partners, regularly invests in European startups via its 2016-launched a €566M fund. Portfolio companies include French Tech up-and-comers like Call Desk, in which EQT Ventures recently participated in an early stage round for the AI-based customer service platform.
Bartosz shared his thoughts on the state of French Tech in a Medium post he published. You can find the entire post here but it’s worth noting his views on the fundamental building blocks France has as a foundation for its growth as tech mecca:
1) Funding: France was the top was the top tech investment market in the EU in the first half of 2017, surpassing the UK, and the momentum is continuing with September funding up 45% over September of 2016 (Source: Dealroom). At the current rate, by the end of 2017 France will see a doubling of total investments in its tech companies compared to 2016.
Bartosz points to the fact that early stage funding is at an all-time high, and participation by international investors is accelerating. He sees a positive sign in more later stage funding happening as well compared to in the past, showing a maturity of the market. And, corporate investment remains a significant part of the trend, with about 30% of the funding coming from that channel.
2) Talent: It’s no secret that France has some of the best and brightest engineering talent in the world. But more and more, these rock star engineers are 1) choosing to stay in France and 2) looking to start their own companies (an HEC Paris survey indicated more than 25% of the grads want to start their own company) – both trends being a shift from the past. There are a variety of new types of schools fueling interest in tech fields in novel and innovative ways, such as Ecole 42, HETIC and Simplon. In addition to this continuous flow of new talent, France’s engineering skills are both less costly and more loyal than other parts of the world, notably Silicon Valley. And with specialized expertise in areas such as AI, machine learning and other critical growth areas, building a company in France is even more attractive.
3) Ecosystem: There continues to be a growing sense of momentum, enablement and a true ecosystem emerging in France. It’s getting bolstered from all angles, including the government, with initiatives such as BPI France’s increased funding of startups, the launch of the French Tech Visa program, and some novel tax schemes aimed at enabling tech startups. The physical landscape is changing, too, with more co-working space popping up around Paris and elsewhere, like WeWork and Remix CoWorking – perhaps overshadowed by the scale and success of Station F, the world largest startup campus which opened in Paris in June. Further startup enablement is being provided by a growing number of accelerators, which includes international leaders like TechStars and Plug & Play Tech Center, that have set up operations in France and complement an already vibrant indigenous accelerator and incubator ecosystem.
Bartosz summarizes his overview of the tech scene by pointing out the ‘economic flywheel’ is happening, with more scaling and late stage funding occurring. He even notes the emergence of French tech ‘mafias’ comprised of successful previous generation entrepreneurs who are now investing in promising French startups – effectively paying it forward for a new generation. He also notes a slight increase of in the number of ‘meaningful’ exits, a topic addressed in another Medium post by Partech’s Reza Malekzadeh, and another positive indication that French Tech is maturing and able to scale.
He concludes by acknowledging that France is not yet Silicon Valley, but that global standard for tech ecosystems didn’t happen overnight, either. So patience is a key, as well as more mentoring and guidance to assist with companies ready to scale. The building blocks are in place to grow the French Tech ecosystem further and hopefully see the emergence of some French Tech Titans.