‘Choose France’ was Macron’s memorable slogan at the World Economic Forum last week. ‘GAFAs’, the French name for FANGS, are looking to invest significantly in artificial intelligence with France making headway in becoming Europe’s next startup hub. It isn’t only the Web Giants that are responding to Macron’s policies; startups in Station F too are thriving in a welcoming and stimulating environment.
GAFAs investment often grab the headlines in France. Google for example plans to open a new AI center in the country, boosting its staff to a grand total of 700 – a 50% increase. It also proposes to open ‘Google Training Rubs’ in Rennes and other locations, in hopes to teach online and digital literacy skills to 100,000 a year.
Facebook too is positioning itself to take advantage of a revitalised French economy. Pledging 10 million euros to develop its own AI center, it will double its AI scientist workforce within the next five years. It’s pushing to take on 40 PhD candidates as part of this expansion, up from 10 previously.
It’s not only the multinational tech corporations that are interested in France. Macron’s Station F is providing a platform, or ‘Le Campus’, for global startups. Le Campus was created so that France could ‘think and move like a startup’, according to Macron. It houses around 1,000 startups, making it the biggest startup hub in the world.
Station F was paid for by multi-billionaire Xavier Niel, owner of Le Monde newspaper and founder of Iliad, the French telecommunications company. Niel invested 250 million euros of his own money into the incubator. He is one of the biggest technology and telecommunications heads in France, with an estimated 9 billion euro net worth. This has earned him the nickname of the ‘French Steve Jobs’.
SAP, the German software company, is investing 150 million euros a year into the incubator, for R&D. It also aims to prop up 50 new startups. This is part of a larger French investment trend with SAP, which will pump 2 billion euros into France over the next five years.
Why are these giants suddenly betting so highly on France? A few obvious answers spring to mind – notably Brexit, Trump, and Macron’s liberalisation plans. Brexit has created a start-up hub vacuum, which Station F can fill. Many English start-ups are moving to the capital, such as ‘Once’ or ‘Innovico’. France has picked up the trend and adapted efficiently and effectively.
Trump’s ascent to power has left a different sort of vacuum: innovators and young people are looking for a new ‘bearer’ of the liberal flame. Macron not only offers a fertile ground for startups, but also for hope and dynamism that has been lost in the US. The German leader has also come under fire for being inflexible and traditional. The French president instead offers vitality, being just 40 years old and famously an ex-investment banker.
Macron’s planned tax cuts are also laying foundations for a healthy tech ecosystem. He plans to introduce a flat tax rate of 30% on capital gains and dividends for startups, down from 45%.
There are other, more subtle reasons for a surging interest in the French economy. France has always had a deep commitment to STEM subjects, with its excellent ‘Grandes Ecoles’. These are similar to Russell Group universities in the UK, although they have more competitive entry requirements. L’Ecole Polytechnic for example is one of the leading science universities in Europe, above UCL in STEM rankings.
Macron’s predecessor Francois Hollande had introduced visas for startup entrepreneurs long before Station F or tax cuts were in the works. This is part of a bigger French work culture which prioritises employees over bosses. The strength of labour unions in the country cannot be overstated.
Brexit, Trump, tax cuts, education, and culture are all hinting that France could be the next Silicon valley. Macron can prop himself up, along with the French tech economy, as the new home for startup hopefuls and GAFA success stories. In the technology business, all roads lead to France.