a Few figures that speak for themselves to ask one of the problems that must try to solve France: among the big companies of the CAC 40, the only “young” technology company called Dassault systèmes. In the United States, the companies in the technology sector represent approximately one-third of the S&P500 index. Dassault systèmes, which has recently bought the american Medidata for $ 5.8 billion, is also the only French listed in the top 100 digital companies listed by Forbes, up from 49 u.s. and 14 chinese. How to improve the financing market for technology companies in French and help our nuggets to cross the walk to be transformed into global champions? It is to these questions that attempts to answer the report of the economist Philippe Tibi, delivered this morning to the minister of Economy and Finance Bruno Le Maire.
The challenge is important: “it is a matter of sovereignty and the condition of the creation of the jobs of tomorrow,” explains Philippe Tibi. Significantly increase the number of ipos and amount of capital raised in favor of innovative companies located in France will help achieve these goals. “The level of life of the French people is secured on the control of the collective means of production modern. The lesson of the last forty years is that the success is not guaranteed.” reminds the report.
The funding, the deciding factor in
Gold in this battle, “the factor funding is a decisive factor. Without funding, nothing has been done, especially in a technological sector where, often, only the first two actors exist actually” stresses Philippe Tibi. In the Face of american competition and chinese, France has serious assets to bring: a high-level research, good engineers, a good level of investment in R&D, an entrepreneurial spirit, especially among young people, and access to a large open european market. Despite all this , it is clear that many start-up French are struggling to change of scale and thus become eligible for an ipo in France. For the authors of the report, this is a result of a “double market failure”: a lack of supply and a low demand for securities of technology companies.
first, the growth of the start-up is slowed down by the lack of funding in the late stage (seedling emergence of more than 30-40 million euros). “The French funds are rarely able to pay for tickets greater than 30 million euros. Now, the last exercise to achieve the status of unicorn generally exceeds 100 million euros.”. The report recommends to have here for 3 years, 10 funds late stage manager each at least 1 billion euros. “We want to repair a market failure by market mechanisms,” says Philippe Tibi. No question of tax incentives or other types of public levers, it will pass by a work of conviction, in which the public authorities have a role to play. “We are working with institutional investors in French” and “we believe that legislation is constant, we can move several billion euros” to growing businesses, explained in July, Cedric O, the secretary of State to digital to the commission of inquiry of the Senate on the sovereignty.
Five to ten funds “global tech”, of the order of € 10 billion
once the company is listed, it is still necessary for shareholders to purchase the securities. To address the problem of the current lack of demand, the report calls the emergence of open-end funds global tech. “The fund “global tech” have one characteristic in common: they are managed by professionals who are experts of technologies, able to make investment decisions based on beliefs and understanding of the economic models original and innovative companies. Their absence in Paris explains the decisions of listing exclusive on the NASDAQ national market of the best French firms,” explains the report. “To create a fund “global tech”, it is necessary to find the money and skills. More specifically, by 3 years, it is necessary to aim at the launch of five to ten funds, of the order of 10 billion euros and 50 portfolio managers.” concludes the mission. She recommends to collect the $ 10 billion in two forms: to the tune of 8 billion euro with institutional investors and 2 billion euros from individuals. “We need to promote the French Tech as a great investment theme in the same way as socially responsible investing (SRI) or social investment,” insists the report. No question of an action of charity, but to convince prospects of financial return interesting. “Imagine-t-on a the performance of a portfolio of stocks built in 1950 by ignoring the sectors of automotive, healthcare or aviation?” asks Philippe Tibi.
“The two things – fund late stage and global tech – are independent,” he says, but it is important to do it at the same time. “These funds are not created instantly, have competent people takes time”. Remains to be seen what the government will withhold from this report. “I think the president of the Republic will have announcements to make at the start, that I can’t deflower”, was also stated to Cedric O before the Commission of inquiry of the Senate on the sovereignty.
