The launch of the Bpifrance Entreprises 1 fund will enable the French to invest in a broad, diversified portfolio of over a thousand French companies, including SMEs and start-ups. The government's stated aim is to steer savings more towards long-term investment and business financing, against the backdrop of the health crisis.
Encouraging the French to invest in domestic companies
In 2020, the French invested 90 billion euros more than the previous year, or 4% of GDP, according to the Banque de France. This record level is essentially linked to the difficulty of spending in the context of confinement. As a result, the most liquid investments, such as the Livret A passbook savings account, recorded higher net inflows. Life insurance, on the other hand, saw a historic decline, with outflows of 7.3 billion euros between January and October.
"Channelling French people's savings towards the real economy and businesses is more than ever a priority," says Bruno Le Maire, Minister of the Economy and Finance, in a press release.
The Bpifrance Entreprises 1 fund extends the efforts to diversify savings vehicles initiated with the PACTE Act, and enables savers toinvest in an aggregate portfolio of 1,500 mainly French, unlisted companies.
A fund based on French private equity funds
This venture capital mutual fund (FCPR) holds shares in 145 French private equity funds, which in turn invest in companies in various sectors and with different maturities.
More specifically, at its inception, the Bpifrance Entreprises 1 fund consisted of :
- 54% in growth capital and buyout capital funds,
- 40% in innovation capital funds,
- and 6% in high-yield funds.
Strong diversification and attractive returns
With an entry ticket of 5,000 euros, this fund opens the way to private equity, an asset class previously reserved for professional and institutional investors. In the current health crisis, private equity is more than ever a serious investment opportunity. Indeed, the returns on offer are often close to or in excess of 10%, far outstripping the performance of other asset classes over 10 years.
The Bpifrance Entreprises 1 fund offers several advantages. The first is its high level of diversification, with exposure to over 1,500 companies. What's more, the announced yield is attractive: 5 to 7% over a maximum of 7 years. Finally, the fund is accessible via a wide range of investment vehicles, including :
- life insurance,
- securities accounts,
- or the PEA-PME.
To subscribe, simply visit the 123-im. com website, or go through a bank, asset management advisor, insurer or retirement savings manager that lists the FCPR Bpifrance Entreprises 1.