VivaTech: how the “start up nation” survived the health crisis

What does not kill you makes you stronger. The famous adage could apply to the French “start-up nation”, gathered since Wednesday June 16 and until Saturday at the VivaTech show in Paris, to celebrate a return to a certain normality after more than a year of pandemic of Covid-19.

Sanitary protocol requires, only 500 start-ups were able to make the trip to the Porte de Versailles to demonstrate “face-to-face” that a year of crisis has not put a brake on innovation in France, nor on investment in this sector. We are far from 13 000 young shoots who were able to promote themselves during the 2019 edition from VivaTech, but the diversity of what is on offer this year is no less great. There are specialists in quantum technology, companies that want to revolutionize computer-assisted surgery, autonomous or flying cars, or even promoters of more connected cities to be more economical and respectful of the environment.

Record sum of 5.4 billion euros raised

An abundance of ideas and projects that illustrate a reality that the players in the sector have all observed: 2020 was generally a good year for French tech, even though the national economy was severely affected by the pandemic. “There has very clearly been an explosion in the volume of investments”, underlines Thomas Dupont-Sentilles, partner at the firm Goodwin and specialist in the financing of start-ups, interviewed by France 24.

In all, French start-ups managed to raise the record sum of 5.4 billion euros last year. A windfall that owes a lot to the interest “of foreign investors – especially North American, but also Japanese and British funds – for the French ecosystem of start-ups,” said this lawyer.

The Covid-19 crisis seems to have served as an indicator of French assets for foreign investors. They realized that there were not only “good engineers, good ideas and a good ecosystem to create start-ups”, notes Thomas Dupont-Sentilles. But “France has also been praised around the world for its ability to react quickly to unlock emergency support systems for start-ups,” recalls Julie Ranty, CEO of VivaTech, interviewed by France 24.

Clearly, these financiers and funds active in a sector – Tech – known for its mistrust of the interference of the public force, have realized the virtues of the welfare state to bring a little stability and visibility into disasters. economically troubled times.

But the “start-up nation” is not a monolith. There are, of course, actors who clink glasses against the Covid-19. “Events, catering and even tourism start-ups have, like the sectors of the economy to which they are attached, been impacted by the crisis”, lists Julie Ranty.

It is more surprising, but the young shoots of “MedTech”, the technology applied to health, have also suffered from the pandemic. “They had to stop clinical trials [car tout l’effort était tourné vers la recherche contre le virus SARS-COV-2, NDLR] which slowed down their growth plan, ”summarizes Thomas Dupont-Sentilles.

But, for him, it is still too early to take stock of the damage caused by the health crisis to these start-ups. The extent of the breakage will only be really known when “the economy is no longer under the state’s drip,” he said.

The time for “impact” start-ups ?

Conversely, there is no doubt that this year of social distancing has been beneficial for all companies working to dematerialize everyday acts. A significant part of the major fundraising – that is to say, several tens of millions of euros – concerned start-ups in this sector. This is the case for Yousign – specialist in electronic signature – which has gathered 30 millions of euros last week or IAD, a real estate network without a physical agency, whose last funding round brought it 300 million euros in February 2021.

The other sector which seems to have the wind in its sails currently includes “impact start-ups”, assures Julie Ranty. These are the young shoots whose project would not only be economically viable, but also beneficial for all of society.

French entrepreneurs would seek to be in phase with “the acceleration of awareness in this way out of the crisis, an acceleration of the desire to switch to a world that is more sustainable”, summarizes the director of VivaTech.

It must be said that the salon she runs is a true mirror of this trend. There are many companies that have developed more sustainable materials, solutions to avoid waste, and technologies to connect isolated populations.

“Before [la crise sanitaire], we had the impression that an entrepreneur had to choose between doing good or growing. This is no longer the case today “, assures Julie Ranty. The famous” Tech for Good “, touted since 2018 by Emmanuel Macron, would it finally take off?

In view of the number of projects carried out by French start-ups, this is obvious. But what about the investor side? “Start-ups that are on the circular economy, on environmental issues succeed in raising important rounds of tables of several tens of millions of euros whereas before they were confined to small financings”, notes Julie Ranty.

Among the notable examples include Back Market (sale of refurbished electronic devices), which raised 276 million euros in May 2021, or Vestiaire Collective, the specialist in the sale of second-hand clothes, which raised 178 million euros in last April. But this is not enough to make it already a major trend out of the crisis for Thomas Dupont-Sentilles. “We see, in fact, projects in this direction that are being created and a tendency to take an interest in questions of environmental and social responsibility during the roundtables, but these are not yet the main drivers of investments”, judges this specialist in start-up financing.

This unprecedented pandemic could still have at least one positive effect: that of closing the chapter on the start-up as a machine to generate growth at any cost, on the model of the Silicon Valley of the boom years, to be turn towards more sustainable development.