French entrepreneurs at the crossroads
France is truly a country of contradictions. Both young and old will tell you the nation’s traditions and heritage must be preserved at all costs in the face of globalisation and Americanisation. State benefits and lifelong protection seem more important than a thriving economy and interesting career prospects. Yet the French are willing to travel in their hundreds of thousands to seek challenging jobs in London, where they frequently achieve high positions thanks to their technical expertise, productivity and innovative ways of working. The French were the most enthusiastic Europeans in leading the march to China and exploiting the huge opportunity there. They also have a flair for small business, able to sell themselves and their companies without the need for huge financial muscle.
French business ability can be seen in the numbers. Library House’s Venturepedia database shows that £349m of Information Technology deals were completed in France last year, compared with just £137m in Germany, which has a larger population. France also outperformed Germany in Healthcare & Life Sciences deals with £257m, against £245m. It trounced Germany in Industrial investment, with £108m in venture deals against Germany’s £56m.
At the same time, the French appear willing to accept a bureaucracy that seems to despise capitalism. The implication is that if you want to set up a business you will have to make it up an icy mountain on your hands and knees. The political elite appears uninterested in the difficulties endured by the business community. President Chirac has, by common consent, done little for entrepreneurship. Hope for the future rests on the two likely candidates in this Spring’s presidential elections, Nicolas Sarkozy and Segolene Royal. Sarkozy is known to admire Tony Blair and to be an advocate of free market capitalism, but he is a political wheeler-dealer and his actions may not match the rhetoric. Royal, on the other hand, has attracted attention because of her use of simple language, her physical presence and beauty, and her ability to connect with ordinary people. Momentum has been with her but she has unexpectedly lost traction in the last couple of weeks. First, a key adviser, Eric Besson, quit in a dispute over whether to release the cost estimates for her spending plans. To add to her misfortunes, her poll ratings have plummeted and last week school children booed her during a visit to a sports ground. Some believe her credibility and campaign are close to collapse.
Should we cry for her? Well, hold back the hankies. Her recently announced manifesto proposes taxing the rich until the pips squeak and imposing an eye-watering minimum wage of €1,500 a month. And not a word on reducing red tape for business. Par for the course for a socialist French politician and not very helpful for entrepreneurial types who would say au revoir to Royal’s campaign without a trace of regret.
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The Week's Deals
Twenty-seven companies gained venture funding this week, seven were of undisclosed value. The deals raised a total of €68.2m, which is €3.4m on average.
Zlango, the Israel-based developer of an icon-based language for web and mobile messaging, has raised $12m (€9.22m) from
Accel Partners and
Benchmark Capital. The Zlango language comprises of 200 icons which stands for words that can put together to create ‘sentences’. In a clever marketing gimmick, the
press release announcing the deal was written entirely in Zlango.
DataLase, the UK-based colour-change chemistry company, has raised $10m (€7.61m) from
MTI Partners,
Hotbed and
BASF Venture Capital. The company has developed material that irreversibly change colour through the application of an external energy source such as heat, various wavelengths of light, and radiation. The technology has applications in range of sectors including product identification, anti-counterfeiting, brand protection and document security.
Echovox, the Switzerland-based mobile media company, has raised $7.5m (€5.76m) from
Advent Venture Partners. Along with the funding round, the company announced the launch of Zong, a free, Europe-wide mobile media platform designed to enable users to easily create and launch revenue-generating mobile services.
dynaTrace Software, the Austria-based provider of enterprise application performance diagnostic products, has raised $5m (€3.8m) from
Bain Capital Partners. The funds will be used to accelerate the company’s sales, marketing, and product development efforts in Europe and North America.
Elsewhere,
ip.access, the UK-based developer of infrastructure equipment for network operators, raised $10m from
Motorola Ventures,
Rothschild & Cie Gestion,
Intel Capital,
Scottish Equity Partners and
Amadeus Capital Partners;
Poseidon Diving Systems, the Sweden-based developer of scuba diving equipment, raised €765k from
Industrifonden and
Start Invest; and
Cellix, the Ireland-based provider of motivational, loyalty, reward, recognition and incentive solutions, raised €800k from
NCB Ventures,
OTC Asset Management and
Enterprise Ireland.
See below for a complete list of deal headlines.
Did we miss anything? If you think we have missed a deal or know of a deal that is about to close then send us your
deal news.
The Week's Exits
Touch Clarity, the UK-based online marketing automation company has been acquired by US-based
Omniture for $51.5m. Touch Clarity allows online businesses to target content and marketing to website users based on behavioral patterns. The deal comprises of $16m in cash immediately, up to $3m in cash payable subject to an earnout based on revenue milestones for 2007, and $32.5m to be paid in stock or cash.
SQM Nordic, the Sweden-based provider of consulting in the field of creating, reinforcing and developing support functions, has been acquired by US-based
TechTeam Global for about €53m. SQM is backed by
Investor Growth Capital.
Epichem Group, the UK-based provider of high-purity gases and chemicals to the electronics and photovoltaic markets, has been acquired by US-based chemicals supplier
Sigma-Aldrich for $60m. Sigma-Aldrich expects the acquisition will contribute towards growth in key high technology markets over the next few years.
Elsewhere
3M has acquired
Acolyte Biomedica, the UK-based provider of a microbial detection platform that aids in the detection, diagnosis, and treatment of infectious diseases; and
Babylon, the provider of single-click information retrieval and translation services has floated on the Tel Aviv Stock Exchange.
People Moves
4G Systems has appointed Enrico Just as chief executive, replacing Alexander Sator who remains with the company as an advisor. Germany-based 4G provides hardware and software products for wireless data communication.
Actix, the UK-based provider of systems that enhance mobile network customer experience, has appointed Alex Hawker as chief executive. Mr Hawker joins Actix from
Amdocs where he was responsible for global sales.
Digital Healthcare, the UK-based supplier of software for diabetic retinal imaging programmes and ophthalmology, has appointed Jeff Gordon as chairman and managing director. Previous managing director Rob Stichbury, and previous chairman Jim Potter have both left the company.
Most Accessed Companies
Zweitgeist, the Germany-based avatars company, has attracted a lot of attention this week. The company has created persistent avatars that allow users to meet and chat with people who are browsing the same web pages at the same time as them. The company was set up last year and recently received backing from
High-Tech Gründerfonds.
DanioLabs, the University of Cambridge spin-out, has also received a lot of attention recently. DanioLabs was established in 2002 to identify new indications for known drugs (a process known as drug reprofiling) in the areas of neurology and ophthalmology. It does this by modeling human diseases in zebrafish, which are vertebrates that model human biology closely. In June 2006 the company initiated its first clinical trial, investigating a combination reprofiling therapy for the relief of quality-of-life symptoms in Parkinson’s patients, with ‘encouraging’ results reported by the end of the year.
Other companies generating interest recently include
Plastic Logic,
NovaThera, and
Touch Clarity.
There are now 9,623 companies in the database and 7,163 investors, comprising 3,568 institutional, 2,978 corporate, 479 individual and 138 other. Of the database's 32,435 contacts, there are 18,463 executive, 7,383 CEOs, 2,482 chair, 1,426 non-executive and 2,681 other.
