France Digitale, which you co-chair, will soon celebrate its 10th anniversary. Is the French tech entrepreneur of today the same as ten years ago?
No, because there are many more, and the work of an entrepreneur has become very attractive, even for students graduating from the Grandes Écoles. Before, young people didn’t want to start a business, it was considered too risky, because normally you couldn’t afford it for several years. Ten years ago, entrepreneurs were more “self-made-men”, and some were also successful, such as Jacques-Antoine Granjon or Marc Simoncini.
We created France Digitale in 2012 because there wasn’t really an organization that helped the startup ecosystem. Many incubators were gradually created and the number of investment funds increased. Today, it is easier to finance the early stages of a business because there are so many start-up funds. When I raised €1.2 million with ISAI in 2010, I already had 400,000 subscribers. Today you can raise money on slides and without clients. It has become cool to undertake in technology.
Does graduating from a Grande École help with entrepreneurship?
When you become an entrepreneur, you necessarily start small. The question of degrees often comes up: do you need degrees to succeed? But we see the matter upside down: you have to start working hard to get good degrees… Those who arrived at good schools worked hard, and when you get the fold, you keep going. So these schools provide the right vocabulary and codes that will allow you to make a sales pitch that sticks.
Why are we so far behind the United States?
What held us back was our misunderstanding of the 2000s bubble. The US took this as a “speed ticket”. They saw the potential of the Internet before we did because they had already seen what it could be with Amazon, Microsoft or even Google. In Europe and especially in France, when the 2000 bubble burst, we were told that it was over, that the Internet was a mirage, and so on.
When I wanted to open a bank account for BlaBlaCar in 2006, I went to see seven banks. You said “Internet”, they closed the door for you… I finally managed to open a Postal Bank account without uttering the word Internet. The 2008 crisis accentuated this delay. It is true that companies such as Meetic, Veepee or even AlloCiné continued to grow, but there was a great setback in investments.
Are we still paying for this delay?
Yup. He is slowly recovering, but you have to project yourself more, anticipate. In the United States, there are 650 unicorns, in France, 27. If we apply the factor x5 [en proportion de la population, NDLR], we must have 130 unicorns at home. Let’s say that if we were in tennis, the United States would win 6-1 against us. We’re not going to make up for what we lost, but we have to try not to lose the second set.
Hope lies in our ability to create and innovate. Large groups will not move alone. Over the past 15 years, the Gafams have bought hundreds of companies. They are very good at doing mergers and acquisitions, integrating teams and growing the businesses they buy. Facebook didn’t invent Instagram, it bought it. Same thing with Google and YouTube. The problem with France is that it has no tech giants, only telecom operators.
The problem with France is that it has no tech giants, only telecom operators.
Has the relationship between start-ups and large groups changed in ten years?
As Jean-Baptiste Rudelle said [cofondateur de Criteo, NDLR] in their columns, “la French Tech” no longer makes you laugh. No more distance or lack of consideration. Large groups take the time to observe what startups and expansions are doing. The concept of disruption is on the minds of all major groups, even the oldest. Some have made major acquisitions: Cegid with Talentsoft, or very recently Renault and Fixter.
Being on Renault’s board of directors, I can also assure you that Luca de Meo is in the process of positioning the company for the future. To avoid finding itself in the same situation as the terminal manufacturer Nokia, it is deploying “Renaulution” in particular for mobility services, under its new Mobilize brand. Eventually, it will generate 20% of the group’s revenue.
What are the biggest mistakes an entrepreneur should avoid?
Above all, don’t believe that you will succeed the first time! That does not exist. You have to try many things. Once again, I will use a sporting metaphor. When you play golf – which I don’t – you don’t put the ball in the hole the first time. You pull in one direction, then gradually get closer and eventually get there.
Burn less money, simplify your operations.
We have entered a period of reluctance with downwardly revised valuations and a slowdown in fundraising. What advice would you give to an entrepreneur?
Burn less money, simplify your operations. We have made great efforts in the pursuit of growth at all costs, which is expensive. Some reviews reached up to 40 times the income! You may have to go back to a multiple of 10. You also have to pay attention to the expense ratio.
During the first six to eight years of BlaBlaCar, I kept a simple rule: I always kept a ratio of two, that is, we only allow ourselves to spend 200 if we have at least 100 of income. Because if you have to reduce the candle, you divide it by two and therefore stay alive. With the large fundraising we’ve seen over the past few months, some companies have significantly surpassed this slider.
What prevents a startup from growing?
Recruitment is the most difficult for several reasons. Firstly, you have to be attractive, and secondly, you have to be able to structure the team at the right pace. I was a little ahead of the curve when I launched the Reviens Léon movement in 2015 to increase the attractiveness of the ecosystem.
So when you recruit, you shouldn’t get into bulimia either. It is bearable to double your workforce each year, but the more it is very risky in terms of solidity and team cohesion… It is necessary to compromise when recruiting, mainly because when a new employee arrives, he must be trained by a person who, therefore, is not 100% in his work.
Is it harder to recruit today?
Yes, the market is very tense, especially in new professions such as “product manager” and data analyst. The BtoB sales profession also suffers from shortages. Many of us are looking for the same profiles…
What else is missing from our French ecosystem?
There’s a big gap: we don’t have a world-class cloud. OVHcloud and Scaleway are doing a great job, but we can see a structural difference: they don’t have a real global commercial customer, when AWS serves and is owned by Amazon and Google Cloud is served and owned by Google. It is possibly a weakness. For example, I would like to see a Mirakl build a cloud.
What is left for French Tech to finally overtake the UK?
Many American companies have always seen the UK as their gateway to Europe. Obviously it is easier for them to settle in an English-speaking country, where the culture is closer. An event like VivaTech shows that France is not French-French, that the ecosystem here is international.
Europe generally buys Americans and Chinese, while it should strive to buy mainly Europeans.
We are penalized by the fact that there is no unified European market. There is a real lack of standardization in terms of regulation, taxation, even labor. It is easier to export from one American state to another than to go from France to Poland. We must also encourage the public procurement of French technology companies. Americans do this extensively at home. Donated money only facilitates cash flow, when money from a customer or public order is also used to advance the product. Finally, Europe usually buys Americans and Chinese, while it should strive to buy mainly Europeans.
If you were named Secretary of State for Digital, what would you do first?
I would start with a major awareness campaign exposing everything that new digital companies bring to our country, both in terms of purchasing power for each of us and in terms of job creation. We must stop mocking the “start-up nation”.
Today, three out of four French people use the services of our start-ups every month, saving time or money, and the digital ecosystem massively creates jobs in new professions. Salaries are high and digital services affect all sectors of activity, from public services to health, education, industry and transport. There is a talent shortage, which opens up huge career opportunities for the new generation, this is good news.
But I’m not a candidate for the job!…
Frédéric Mazzella founded the carpooling website BlaBlaCar in 2006 while studying at Insead. Before joining the prestigious business school, he studied at Ecole Normale Supérieure (physics) and Stanford (computer science). Ten years after the start-up was created, he left the position of general manager to become president. In 2018, Frédéric Mazzella was elected co-president of the France Digitale association and member of the board of directors of Polytechnique. Since April 2021, he has been a member of the Board of Directors of Renault. In parallel with his mandates, Frédéric Mazzella regularly invests in start-ups.
Frédéric Mazzella has just been re-elected a member of France Digitale. The association, which brings together entrepreneurs and investors in French technology, will celebrate its tenth anniversary next September. In January, he published “Mission BlaBlaCar” (Eyrolles Editions), a book that chronicles his entrepreneurial adventure and gives advice to anyone looking to get started.