Taking Stock Of Tech Startups In Paris
Last week I attended Open Coffee in Paris where I met a bunch of interesting entrepreneurs. I also met the people who run a PR firm in Paris called Ballou PR. They asked me to do a full day “speed dating” session and a Pont Party during my time in Paris. After explaining the details of both, I said yes. I am not sure which is more fun, meeting 16 entrepreneurs in one day or drinking wine in the early evening on a bridge over the Seine, but honestly they both sounded good to me.
The Pont Party is next week, the 17th to be exact, at 18:30 on Passerelle Solferino. I posted the details last night. If you are in Paris and want to meet entrepreneurs, you should come by.
I did the “speed dating” event yesterday and I mentioned it briefly in a post last night. I want to add some more color, give my high level impressions, and talk about a few specific companies that have live services you all might want to check out.
Again, I’d like to thank Marc Brandsma of Chausson Finance and Ken and Colette from Ballou for putting it together. I linked to their online coordinates in the post last night.
Marc, Ken, and Colette work with Parisian startups every day and I was able to get a few minutes alone with them over breakfast and lunch to talk about the overall state of the startup market in France, but specifically Paris. Since we don’t invest in biotech, cleantech, or hardware or communications, my comments are going to be limited to web technology, mobile, and gaming applications.
In some ways, being an entrepreneur in Paris is like being an entrepreneur anywhere. The odds are against you, nothing comes easily, and most people think you are crazy. It’s harder to be an entrepreneur in Paris than it is in Silicon Valley. It also seems harder than NYC or many cities in the US. And I suspect it’s harder than London as well.
Entrepreneurship is a French word and modern day venture capital was invented by a Frenchman named George Doriot. If you don’t know about Doriot, you haven’t been reading this blog recently. But even though the French have a historical connection to entrepreneurship and venture capital, the French economy and society doesn’t seem to be particularly supportive of entrepreneurship.
It starts with the economics of being an entrepreneur. The tax situation in France is such that if you make it big with a startup, you’ll probably move to Belgium or Luxembourg so you can keep most of the fruits of your labor. That’s a big deal because, as we know, it’s the past successes and the people who have had them that seed the next successes.
But it’s also true that the French society doesn’t value risk taking in quite the same way that the US does. I heard yesterday about a tax break that the government recently passed that allows wealthy people invest in startups instead of paying windfall taxes to the government. Sounds great, right? But tax and financial advisors quickly came up with schemes to route those tax breaks into super safe investments that simply capture the tax breaks but take no risks. Maybe that would happen in the US too, but somehow I think our culture in the US values likes to play higher up on the risk/reward curve.
Being an entrepreneur in Paris is a bit like being one in NYC. It’s not like Silicon Valley where everyone seems to be starting a company, working in a startup, or investing in a startup. In NYC and Paris, most people work in big companies and don’t read Techmeme and Valleywag. So when you are an entrepreneur in NYC or Paris, you are the nutty one, not the mainstream.
But all that said, the entrepreneurs I met yesterday were very typical of the people I meet every day in our business. And they are working on exactly the same problems/opportunities that startups in the US are working on.
Here a list of the general areas that the sixteen startups I met with yesterday are working on, along with the number of companies I saw working in that area, and a comment about whether our firm had looked at a similar opportunity in the past three months (noted as “current”):
Entertainment ratings/reviews – one company – current
Mobile banking – one company – current
P2P lending – one company – current
Interactive/Internet TV – two companies – current
Sentiment analysis/tracking – one company – current
Stock footage – one company – current
Mobile gaming – two companies – current
Mobile RSS – one company – current
iPhone apps – one company - current
Prediction markets – one company – current
Virtual worlds – one company – current
Video ad creation – one company – current
Mobile/web integration – one company – current
Career/Jobs web service – one company - current
What that list tells me is that Parisian entrepreneurs are as up to speed on where the current opportunities as much as anyone in silicon valley, NYC, or anywhere else in the world. I’ve talked a lot about this lately, but globalization means that the word travels fast. Don’t think that the most interesting mobile games or iPhone apps will be built in Silcon Valley or even the US. Some will. Many won’t be.
And I thought that the quality of the technologists I met (some of the presenters were the technical founders, some were not) was very high. And most of the development teams were local, built from the ground up in France. That is different from what we are seeing more and more of in the US.
I often hear that European startups often get focused on the regional or even country specific opportunities and as such the upside of investing in Europe startups is not as high as US startups. The sixteen companies I looked at broke out like this:
France focus: 3
Europe focus: 2
Europe/Asia focus: 1
Global focus: 10
So, it’s true that some French startups do focus locally or regionally, but most of the companies I met with are thinking globally day one. I don’t know if that’s a recent change in orientation or something else, but I see that as very positive.
So that’s it for the color commentary and high level impressions. Here are a few interesting web services I learned about yesterday. Check them out and let me know what you think.
ulik.com – social service for entertainment focused on ratings
wixi.com – invite only service for sharing music and video
twitrss – a mobile RSS reader in early alpha that uses twitter for sms alerts
yoowalk – a virtual world built entirely in flash available via a web browser
mypronostic.com - prediction marketplace
French only, soon to be available in additional languages/countries: