9 things that happened in 2019 in French startups

As 2019 ends, here's a brief and very factual summary of what happened in 'La French Tech' in 2019

As you may wonder if you’re familiar with VC blogging, yes I unashamedly stole this blog post format from USV founder Fred Wilson. I think it’s a great format to wrap up a year that passed and start off the one that’s starting with a clear mind and concrete, falsifiable assumptions to be tested.

Below is a non-exhaustive list of interesting things that happened in the VC ecosystem, with a (strong) focus on France. Let me know if you see things differently!

  1. As a sign of a maturing startup ecosystem, the number and visibility of repeat entrepreneurs with an exit under their belt skyrocketed:

    • Ex-Withings founder Eric Carreel’s Zoov raised this year

    • Made.com’s Ning Li launched Typology

    • Alittlemarket founders Nicolas Cohen and Nicolas d’Audiffret launched AnkorStore

    • the team from MonDocteur launched PixPay this year, while its competitor Kard is also co-founded mostly by ex-entrepreneurs

    • Criteo’s Romain Niccoli co-founded Strana

    • Wit.ai’s Alexandre Lebrun launched Nabla

    • the PriceMatch founders launched and/or raised for several new ventures

    • I know of at least 3 others that haven’t changed their LinkedIn profile so I won’t name them here, tackling the consumer fintech or direct-to-consumer space with new projects

    • Interestingly, fintech and direct-to-consumer seem to be topics that particularly attract repeat founders this year :)

  2. These repeat founders can count on the fact that seed investing is becoming more and more structured in order to get initial funding based on their track-record and kickstart the business:

    • Frst.vc spun out of Otium and raised a seed fund (congrats Pierre, Bruno & Gabriel!)

    • Top-notch former entrepreneurs and long time business angels teamed up to create a more structured syndicate

    • Several foreign seed funds chose 2019 to hire or staff a dedicated for France (Samaipata, Stride and Cherry)

    • While obviously most existing seed investment players remained active

  3. When these companies are growing, 2019 showed that there’s a striking consistency in the ability of French startups to raise mega-rounds since 2017:

    • 12 of them raised >€25m in 2019 (vs. 13 in 2018 and 8 in 2017): TalentSoft, Lunchr, Malt, Alan, 360Learning, FretLink, Heetch, VestiaireCollective, Ornikar, Spendesk, Akeneo and Blade

    • 7 raised >€50m (vs. 4 and 10): Wynd, ContentSquare, Mirakl, Payfit, Ivalua, Jobteaser and Algolia

    • 4 raised >€100m (vs. 3 and 1): Ynsect, Doctolib, ManoMano and Meero

    • in total, that’s c.20 companies a year raising more than €25m for the third consecutive year (vs. 11 in 2016 and 8 in 2015)

  4. Thanks to these mega-rounds, France anecdotically adopted three new ‘unicorns’ to the club in 2019: Dataiku (which my employer Alven backed since the seed round), Doctolib and Ivalua.

  5. This slight increase in mega-rounds has been enabled by the fast-growing interest of foreign VC funds in French startups:

    • According to a report released mid-year by PitchBook, US VCs participated in financing rounds equalling half of the money invested into French startups in the first half of 2019 (!), to be compared to c. 1/3 in 2018

    • As you’ve probably read if you’re exposed to the infamous ‘VC Twitter’, the most prestigious US VC firms are said to open shops in Europe, and I wouldn’t be suprised if people in France were lobbying for Paris instead of London

    • European funds are not giving up just yet, with Balderton and Atomico and some more to come relocating some of their teams to Paris

  6. These bigger rounds are more often then not in startups that have raised very recently, which shortens the traditional 12-18 months cycle between two funding rounds:

    • Lunchr’s Series B was 9 month after its A

    • Alan’s Series B was 10 month after its A

    • Meero’s Series C was 11 month after its big B round

    • many other companies raised two rounds in 2019, with the second oftentimes led by a non-French investor, sometimes with just a few months gap

  7. Interestingly, businesses which were historically outside of this regular VC cash-injection game joined the party in 2019. Hot markets are always a good time to take some money off the table

    • Long-time bootstrapped Legalstart finally raised in 2019

    • Just like data visualisation startup ToucanToco

    • This is not dissimilar to 1Password in the US, which raised it’s first round of $200m

  8. Indeed, financially substantial VC-backed exits remained a rare thing in 2019

    • MeilleursAgents (€200m) and Drivy ($300m), two Alven portfolio companies, were the only two companies exiting for >$200m

    • Mailjet, Snips, Sculpteo and Streamroot are filling the ranks of VC-backed exits which still seem pretty desertic

  9. Politically, startups became even more of a trendy topic to get positive vibes, on the back of the political line that Emmanuel Macron is having since his election in May 2017

    • Much has been said about the Next40, a curated and contested list of 40 up-and-coming startups that are potential candidates to ‘replace’ the 40 biggest market caps listed on the French market

    • And about the €2bn that the French public investment bank BPI is looking to deploy as an LP into later stage funds

Hope you enjoyed reading! I kept it very factual and analysis-free on purpose, tomorrow’s post about what I think will happen in 2020 will be a bit more personal :)