“It is wrong to be right too soon. » This quote from Marguerite Yourcenar could not be more relevant in economics. It summarizes, unfortunately very well, the setbacks of Sigfox. The former French star of the Internet of Things, in lack of cash, was placed, this Wednesday, in receivership. Founded in 2009, this Toulouse startup was a pioneer. It has developed before anyone else a technology allowing to connect myriads of objects, thanks to low-cost and energy-efficient sensors. Its objective: to enable companies, by connecting their assets, to revolutionize their industrial processes, their logistics, as well as to launch new services while achieving significant savings.
But the mayonnaise never took. At least not in the expected proportions. Sigfox probably arrived too soon, and probably underestimated the time that manufacturers would take to adopt this type of solution. In its press release, the group concedes: ” The decision to place Sigfox under legal protection came about due to a slower-than-expected adoption cycle for its technology. » While in 2019, Sigfox was still counting on 1 billion objects connected to its network, today it only has around 19 million. Suffice to say that we are far, very far from the mark.
An untenable financial situation
Financially asphyxiated, and failing to reach economic equilibrium, Sigfox gave itself some breathing space in September 2020 by selling its network in Germany to the Cube Infrastructure investment fund. A few months later, it was a big sweep that hit the group. Sigfox has hacked its workforce. It has gone from 400 employees to 250 today. Above all, Ludovic Le Moan, his emblematic boss, was asked to give up his apron. He was replaced by Jeremy Prince, former president of Sigfox USA, and member of the executive committee.
A few weeks ago, this one showed up, in an interview at The gallery, resolutely optimistic about the future of the group. Even if the one displayed however in 2020, according to our information, a loss of more than 90 million euros for a turnover of 24 million euros. All coupled with a debt of 153 million euros. Jeremy Prince’s strategy was essentially to grit his teeth, waiting for the Internet of Things market to take off. And so that Sigfox is finally making a profit. But to hold, Sigfox absolutely needed to sell its French network, Sigfox France SAS, also placed in receivership. According to our information, a buyer has positioned itself. But he failed. Without this financial windfall, Sigfox found itself back to the wall, which precipitated its downfall.
The economic context and the health crisis have not helped either. In its press release, Sigfox points out that “the IoT sector has been marked by the Covid-19 crisis which has slowed down activity over the past two years”. The group also suffered from another crisis: that of semiconductors, with “a market for electronic components that has been in short supply for several months”.
A consolidation of the Internet of Things market?
Now, Sigfox is looking for a buyer. Now begins a six-month observation period, which is renewable. A receiver must help the group identify potential buyers. Who might be interested? Maybe a Sigfox competitor. Alongside the Toulouse group, other similar technologies exist, such as LoRa or NB-IOT. The sale of Sigfox could be an opportunity for market consolidation, as already envisaged by Jeremy Prince more than a month ago. AT The galleryhe said he was convinced that “Sigfox technology will, whatever happens, always be there because it is necessary for certain use cases”. “Even in the worst casehe added, this technology will remain through consolidation. » The next few months will be decisive for the future of the group.
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