If it continues to innovate, French Tech attracts much fewer large investors than in the past, with fundraising down sharply (-34%) in 2023.
In 2022, French Tech had a record year, raising 13.6 billion euros. But the madness never lasts long, and the year 2023 was much less fluent for it, with 9 billion euros accumulated, down 34%. France still has nothing to be ashamed of, since everywhere in Europe, levies have plunged. France is even alone behind Great Britain (16 billion euros) and ahead of Germany (7 billion euros). All this confirms one thing: funding is contracting.
There were much fewer major fundraisers last year
Is the speculative bubble around French Tech start-ups about to burst? Your reflection may not have to stop with our article, but we will give you some answers. Already, as the latest In Extenso Innovation Croissance, ESSEC Business School and France Angeles barometer confirms, mega-raisings are on the decline.
Those with an amount greater than 50 million euros fell by 50% over one year, while France recorded only 13 funding rounds worth more than 100 million euros in 2023, compared to 28 the year former. If the number of collections (1010) was increasing last year (+11%), the average ticket (10 million euros) plunged by 36%. And it’s anything but trivial.
“ The Tech market mechanically continues its downward cycle for a few more quarters. However, it is in crises that ecosystems show their solidity and strengthen themselves to get back on track. Not only is the French Tech ecosystem holding up much better than that of other European countries, but major initiatives are being launched to strengthen it », analyzes Nicolas Landrin, executive director at ESSEC Business School. “ France is creating the conditions to become the most favorable country in Europe for the creation and development of start-ups », he continues.
Capable of big moves, France must expect more caution from investors
Professionals therefore explain to us that French start-ups are and will be supported, but in smaller proportions. Funding rounds now take longer to materialize, and investors have very high expectations in terms of profitability. Many companies are supported at start-up (+35% in 2023) and the trend remains towards business creation, but we note a real contraction in financing conditions, which creates doubt for the year which has just come. to start up.
France will have achieved some “coups” in 2023, with the historic fundraising of Verkor (850 million euros), for its battery gigafactory project. We also think of those of 385 million then 105 million euros from Mistral AI, a generative artificial intelligence start-up specializing in large language models, like OpenAI, which made former Secretary of State Cédric O a rich man.
French Tech especially shone in sectors such as energy/Cleantech (2.6 billion euros), health (1.8 billion) and software/software (1.2 billion), while FinTech dominated in 2022. Overall, AI has obviously had an impact on fundraising, generating 1.4 billion euros of financing in France. “ The year 2024 promises to be open but caution remains in order! The 2024 Finance Law will certainly make it possible to strengthen seeding and accelerate the growth of our Deeptech », concludes the associate president of In Extenson Innovation Croissance, Patricia Braun.
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