As 2025 kicks off, Alexandre Dewez, a partner of the Series A & Growth fund at 20VC, released a 2024 report on the state of the French tech ecosystem. As he writes in his most recent edition of Overlooked, the report covers "everything: general metrics, tech trends, AI, unicorns, funds investing in France, exits and an outlook for 2025!"
While the broader European ecosystem remains down 7% year-over-year, France stands out, recovering from the 2023 correction and making a 3-point gain in 2024.
It's no surprise VivaTech, Europe's biggest tech and startup event, is here in Paris: it's the perfect place to talk about the future of tech and innovation, and we've been talking about it for almost ten years! Let’s take a closer look at the report.
Over 1,000 AI Startups in France, with Over 50% in Paris
Although many are drawn to the world-class architecture, arts, and cuisine of Paris, the city has begun to attract a new demographic: startups. With over half of French AI startups choosing to operate out of Paris, the city has positioned itself as a top tech ecosystem due to six essential factors:
Top engineering schools: Paris is home to many world-renowned engineering schools like ENS, Centrale, and ENSTA. Furthermore, many of these schools offer dual-degree programs with top business schools like HEC and ESSEC.
Strong research programs: Research is supported on all sides, with both the public and private sectors contributing significant amounts of money. France as a whole allocates 2.24% of GDP to research & development.
Governmental support: The French government offers corporate tax rebates on R&D salaries for engineers and researchers, as well as billions of euros in AI funding already structured into France's 2030 economic plan.
Developing tech ecosystem: There are over 1,000 AI startups already in France, with over 50% based in Paris.
Top tech companies: Major tech companies have started AI labs in Paris, including Meta, Google, and OpenAI.
French corporates: Fierce competition fuels advancements as Paris-headquartered French companies like Mistral AI and Owkin race to be at the front of the revolution.
AI Funding: 27% of Total Capital Raised
AI funding has proved to be a major growth driver for the French tech economy, making up 27% of total capital raised. This figure represents an 82% growth year-over-year.
AI startups in France operate throughout the entire value chain, from foundation models to infrastructure and applications. These talented players throughout the country are working on projects like drug discovery in healthcare, deploying LLMs in production, and AI-powered SDRs.
Other key sectors that attracted funding in 2024 include climate, finance & insurance, and vertical software.
Over €7 Billion Raised by French Startups
In 2024, €7.1 billion in capital was raised by French startups across 518 funding rounds, representing a 3% year-over-year growth. Of this money raised, 36% comes from U.S investors, giving France an international edge.
However, the U.S is not the only external player looking to invest in French startups. Top multi-stage UK funds like Accel, Index, and Balderton are also participating in purchase agreements, as well as emerging pan-European GPs.
Want to join the Paris tech ecosystem in 2025? Book your pass for VivaTech today and get a foot in the door of Europe's favorite tech hub!
