While it's still too early to determine precisely what impact the health crisis will have on the financing of French startups, the results of a study published last June are rather encouraging. They show that the outbreak of the virus has not brought capital-raising operations to a halt. In the first half of the year, these players raised €455 million, up 12% on 2019.
Strong fundraising despite the coronavirus
Despite the coronavirus crisis, fundraising operations by French startups saw "sustained activity" in the 1st half of 2020, according to the latest Barometer published by the France Fintech association. In June alone, 123.2 million euros were raised in 5 operations, with an average ticket in excess of 30 million euros. The volume of fundraising is thus much higher than in previous months: 56.7 million euros in April, 22 million euros in May.
In all, over the first 6 months of the year, some 30 transactions were completed, for a total of 455 million euros and an average ticket of 15.2 million euros.
Growing interest from foreign investors in French startups
Among the largest fundraising deals recorded in H1 2020 were those announced by startups Swile ex-Lunchr (€70 million), Alan (€50 million), Lydia (€40 million) and Cybel Angel (€33 million).
The France Fintech association has noted a growing interest in French start-ups on the part of foreign investors. Indeed, they are taking a close look at this market, and coming forward when a promising fintech appears. The BATXs (Baidu, Alibaba, Tencent, Xiaomi) are beginning to establish themselves in Europe and France. Tencent, for example, has acquired shares in Lydia and around twenty other startups worldwide, including N26, Nubank and Paystack. They are thus more active than the GAFAs (Google, Apple, Facebook, Amazon), who make fewer acquisitions. " The arrival of global investors tends to confirm the attractiveness of our ecosystem," says France Fintech in its study.
Payment, the leading Fintech business
Another of the association's findings is that payment is still the leading fintech sector, attracting investors. It remains particularly popular, accountingfor 36% of funds raised in the first half of the year, or 178 million euros. Next come digital banking (28% of funds raised, or 137 million euros) and insurancetech (12%, or 61 million euros).
Taking all these factors into account, France Fintech concludes that "the 2020 vintage may ultimately be less impacted by the crisis than feared".