Is France in the post-Brexit/Trump race to become a leading tech hub?
Since the tightened immigration proposals of Brexit and Trump countries like Canada and France have decided to sell themselves as attractive homes for foreign talent.
It has long been part of geopolitical understanding that global economics functions off countries competing to out-tax, out-talent and out-regulate each other. This latest PR battle is an interesting and explicit attempt by some countries to capitalise on what they see as socially driven but competitively harmful electoral mandates.
The tech sector has always had a particularly international outlook, condemning immigration restrictions as harmful to their business. They have argued that some of their best talent comes from abroad, though their diversity statistics don’t necessarily correlate with this.
France’s president, Emmanuel Macron, has been vocal in the past about his desire to attract international talent. And France does indeed have a lot going for it, with good engineering institutions and increasing investment in technology. But it also has to contend with Europe-wide decisions, which have focused less on immediate economic competitiveness and more on a sustainable social environment (the effects of which are yet unclear).
France has been increasing its investment in technology of late, accelerating ahead of German levels of investment and approaching UK levels, according to an investigation in the Financial Times. However, average deal sizes are far lower, which suggests France’s technology startups are still in their very early stages and growth-capital is yet to materialise.
In many ways Europe has a lot of potential as a tech hub, with an advanced economy of over 500 million and a highly educated workforce. But the amount of money invested overall at a continent level is far below the US, which has an enormous venture capital scene, and Asia, which generally has high levels of state investment. However, unlike Asia, Europe has a deep and broad tech economy with most industries having incorporated digitised foundations long ago.
That being said, the European regulatory stance is completely at odds with Asian or North American markets. EU bodies have not been shy to hit big-tech with huge fines, and are on the brink of introducing GDPR which is the most comprehensive and consumer-focused tech regulation around. Further, in reality, Europe is a set of disparate markets with different languages and taxes which make it complicated to enter.
That aside, no single European country is big enough to maintain a presence in any industry by itself. Current European growth is slow, but another big country like France taking a specific interest in the tech sector will benefit all of European tech in adding to the immediate environment.
In general the European tech sector has everything it needs to be one of the biggest global players in any regard. With French commitment this becomes more likely, though many bigger steps are still needed.