Let A Thousand Start-Ups Bloom

What a difference a year makes. When the local digerati gathered in Paris in 2012 for LeWeb, an annual Internet conference that attracts a global audience, the atmosphere was morose. An initiative by the new government to tax capital gains as salary had led investors and entrepreneurs to form a lobby group called “Les Pigeons,” slang for suckers, to express their opposition and frustration. The talk was about how entrepreneurs were fleeing France. And things didn’t improve in May when the sale of video-sharing site Dailymotion to Yahoo! was blocked by the French government. Fast forward to December 2013 and the mood is noticeably more upbeat.

The government has backed down from its original capital gains tax proposal (although proposed 2014 amendments to tax laws have some in the sector worried). France’s Criteo, a global online ad retargeting company, priced its enlarged October U.S. initial public offering on the NASDAQ at $31 per share, above its expected price range, raising $250 million. Car-sharing service BlaBlaCar, another of France’s rising tech stars, has rapidly expanded across Europe and looks on track to handle more passengers than the Eurostar. And early-stage companies like Shopmium are continuing to attract investors from outside France, such as Accel Partners (see the Top 25 companies to meet at LeWeb on pages 12 and 13).

Nowhere is le nouvel optimisme more apparent than at Numa, a 1,500-square-meter space on Rue du Caire, which consolidates existing accelerators Le Camping and La Cantine and is expected to attract up to 45,000 visitors and 600 tech start-ups in its first year. Some 8,500 people signed up for the November 14th opening; about 6,000 showed up and Rue Caire had to be blocked off to accommodate the overflow.

So much for former U.S. President George W. Bush’s rumored statement that “The problem with the French is that they don’t have a word for entrepreneur.”

“The opening of Numa arrives at a time when the whole start-up scene in Paris has evolved and matured a lot,” says Adrien Schmidt, head of Silicon Sentier, an organization representing the city’s start-ups which is named after the Sentier neighborhood in Paris’s second arrondissement. “Things are changing. We are not yet London or Berlin but we know that is where we want to go.”

While Paris already had La Cantine, Le Camping and Silicon Xperience, prior to the opening of Numa Paris lacked a central hub on a par with Google Campus in London. Now it has one, thanks in part to Google. The U.S. search engine giant is one of five major partners of Numa. Its involvement with the French tech hub is tied to a ramped-up effort by Google to stimulate start-up ecosystems in Europe beyond London. To that end, it recently appointed Eze Vidra, the head of Campus London, as head of Google for Entrepreneurs Europe.

Google For Entrepreneurs is part of the company’s global effort to empower start-ups and entrepreneurs around the world. The team, which runs more than 50 efforts in over 100 countries, plans to play a more active role in fostering entrepreneurship in local European communities in partnership with leading organizations like Startup Weekend and dozens of incubators and accelerators. “We want to give European entrepreneurs the technology tools and training they need but also to connect them to the Valley,” through projects like Blackbox Connect, a two-week immersion program for founders who are based outside the U.S., says Vidra, who was on hand for the opening of the new Paris center. Helping Numa is just the start, he promised. “There will be others.”

Google is providing Android devices for entrepreneurs to use when testing their technology at Numa and professional video equipment so that French entrepreneurs can communicate with various Google Campuses, record professional videos to attract attention to their start-ups and use Google Hangout to access Google engineers and designers during virtual office hours.

Although it is an independent project, in many ways Numa resembles Campus London: it sports an open café on the ground floor where entrepreneurs and investors can hang out. On another floor it offers a co-working space similar to that of TechHub at Campus London, where entrepreneurs can pay to rent space by the week or the month. And like Seedcamp, which inhabits a floor of Campus London, Le Camping will choose 12 selected start-ups to work and be mentored in the office space for a period of four months, twice a year.

Despite the similarities, the project was launched before Google Campus opened. The City of Paris and the Ile de France regional council issued a call for tender to build an “integrated innovation building” back in 2011, with the backing of Orange, bank BNP Paribas and Google, says Schmidt, who in addition to overseeing Numa has a day job running a data analytics start-up called Squid Solutions. Numa, which is a blend of the words “numerique” (digital) and “humain” (human), has also attracted sponsorship money from French railway SNCF, French electric company EDF and office furniture maker Steelcase.

Orange is supplying broadband and WiFi connectivity, including a gigabit pipe and 4G coverage and has set up a telepresence center to allow the broadcasting of events and videoconferencing. It is sending experts to Numa on a rolling basis and has agreed to open up its customer data and some of its client base to selected start-ups who want to work on innovative new services. SNCF also wants to share data about its customers in order to bring new applications to the market. “Almost all of our partners want to join our big data/open data program,” says Schmidt. “Large companies don’t know what to do with all their data and it is a great opportunity for data start-ups to work on real-life sets of data and create great ideas.”

In addition to raising money from sponsors, Numa crowdfunded an additional €170,000 from over 600 people — one of the biggest crowdfunding operations in France to date, Schmidt said.

The tech hub has big objectives. “It is true that the French tech scene used to be insular, but now Paris’s entrepreneurs absolutely want to be international. Are we there yet? Unfortunately not. We are failing to attract people to come here from all over the world so we need to change this so we can foster the kind of diversity that benefits creativity,” says Schmidt. To that end, Numa will launch an English-language web site and the team running Numa will go on a road show to try to attract investors to come and visit Paris, he says.

Having a central point where foreign investors can go to meet start-ups will help. Until Numa was opened French start-ups were spread out in Le Camping and La Cantine’s two small buildings and other places.

Within two years Numa’s digs may be overshadowed by another ambitious project. In September, the city of Paris announced the 1000 Start-Ups project, which is being funded by French entrepreneur Xavier Niel, the founder of French Internet service provider Illiad, along with la Caisse des Dépôts et Consignations, an investment arm of the French government. Starting in 2016, the Halle Freyssinet, an old shipping and freight center in Paris’s 13th arrondissement, will be transformed into a massive tech incubator with 30,000 square meters of co-working and office space. The project is being billed as the world’s largest tech incubator.

With the help of new projects like Numa and 1000 Start-Ups, it is not surprising that there is more optimism at this year’s LeWeb. If the new tech hubs live up to their promise and the government makes an effort to help rather than hamper tech companies, more entrepreneurs might actually move into France instead of moving out.

 

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