Rising Bankruptcies Threaten France's Tech Start-Up Ambitions

A recent survey reveals an increase in bankruptcies among French tech start-ups, challenging the image of Paris as a leading European tech hub. ScaleX Invest found 10.4% of start-ups are at high risk of bankruptcy, emphasizing difficulties in accessing capital amid tighter funding conditions.

A survey published on Tuesday indicates a worrying rise in bankruptcies among French tech start-ups, casting doubt on President Emmanuel Macron's vision of Paris as a premier European tech hub. This revelation could impact the perception of French leadership in the tech sector, which has been a key driver of the country's economy.

President Macron has previously promoted Paris' Station F as a symbol of the nation's thriving tech scene, while France's global AI summit earlier this year attracted significant investment pledges. However, the survey by ScaleX Invest reveals a troubling trend with 10.4% of 1,487 analyzed start-ups identified as high-risk for bankruptcy.

The report highlights a shift in the financial landscape, where seasoned companies face insolvency despite substantial funding. The finding that mature firms raised twice the capital than in prior years but still failed underlines challenges in the current economic climate, including tighter funding conditions and declining valuations.

(With inputs from agencies.)