La French Tech — The New French Revolution

Episode Summary

"The New French Revolution" that's the name given to La French Tech, a government initiative of France, one of the few in the world that has dedicated a national strategy to support French start-ups in hubs around the world, including in the US. The leader of this pro-business movement is Director Kat Borlongan, a Filipino-French citizen whose cross-cultural experience and vision for innovation is putting the already-accelerating tech movement in France on the map. Working with teams in France and in the U.S., Kat is broadening the scope and influence of French entrepreneurship and the broader startup culture by promoting diversity and challenging the discourse around women leaders.

Episode Transcription

Andrea FORT  0:10  

From the Embassy of France in United States, this is FrancoFiles, a podcast where we explore the unique relationship between France and the US. My name is Andrea, and I will be your host. Bonjour Francophiles, today we're going to be speaking with Kat Borlongan, the director of the French Tech mission. Now most of us know that tech is the future, we keep hearing that it is what is up and coming. That is what's happening now, what's important in our society. But do you know about the future of La French Tech, which is a government led initiative to bolster support for the French startup ecosystem in France, in the US and all over the world? So I'm very glad to have Kat with us today. Welcome, Kat.

Kat BORLONGAN  1:03  

Thanks for having me.

Andrea FORT  1:04  

So Kat, it's so nice to have you with us. You know, I have a lot of questions about La French tech, but I actually just want to know, you know, why don't you tell us a little bit about yourself. You are the director of the French tech mission. But you are, of course, much more than that.

Kat BORLONGAN  1:20  

Before I joined French government, I was an entrepreneur, I launched an innovation agency called Five by Five, which was specialized in startup and corporate relationships. And I'm also, I guess, part of my identity as the director of the French Tech mission is that I'm also very proudly, immigrant. I moved to France when I was 20, from the Philippines, lived in a whole bunch of different places, mostly in Canada and Japan, before settling down in France, like I have today and did a lot of work for lots of different organizations from Google, to the World Bank, on issues related to startups and institutional partnerships.

Andrea FORT  2:03  

Wow, that's quite a vast professional background. So now you're the director of the French Tech mission. So for our audience, what is most important here to know is you know, what is La French Tech, and what does this label, or this network if you will, represent?

Kat BORLONGAN  2:21  

Sure, so the French Tech is the nickname of the French tech ecosystem. And everyone who's in it really, founders, investors, incubators, accelerators. And it started off as a global sort of grassroots movement that, you know, really wanted to bolster friends as a very strong startup ecosystem. And over time, it's also become a government team, which is the team that I lead. And so you know, we do lots of different things, everything from making sure that we have pro startup public policy. And so that's everything from the visas to stock options, regimes, we do quite a bit of work as well on funding, and France's, you know, both famous and notorious for being quite a proactive investor in all of Europe, over 1.3 billion is invested by the French government every year, directly into startups. And then we also have a lot of programs. So we have national programs that functions a bit like accelerator programs, and they're run all across the country. Some of them are specialized in late stage startups. Some of them are specialized in startups from very diverse and tough backgrounds. And then, of course, there is a network of 114 French tech communities all around the world that we bring together to help us out.

Andrea FORT  3:42  

This national initiative has brought visibility to the growth the talent of this industry around the world. But let's be clear about something is that the French tech ecosystem, of course, existed already. Now it just has additional support from the government. And it's helped French tech reach international spaces, move into capitals, as you were saying, and creating ecosystems around the world. I want to know more about this expansion.

Kat BORLONGAN  4:11  

Sure. So you know, French tech as a movement was launched in 2013. I think the ecosystem itself started really popping up back in 2011. So you know, the good news is that the French government did not, and they're certainly not claiming to have invented the French tech ecosystem, and since then, has been growing at this unparalleled rate really breaking a lot of records. I think what's very special about the French tech ecosystem, as opposed to a lot of its counterparts across the world is that when it first started, you know, we had very tiny companies, you know, kind of popping out of nowhere. You would have investors that would come to France but certainly not to meet French companies, they would come here more for the Riviera or the Alps or you know, to drink a cool glass of rosé on a Parisian terrace. But no one was coming to France to actually invest in tech and France at the time was considered a bit of a backwater when it came to innovation. And you went from that in 2013 to today, you know, all of a sudden, 14 unicorns, series of mega rounds being raised with miracles, a b2b marketplace in France raised around over 300 million not too long ago. And so we've essentially leapfrog the entire development curve. Now, maybe your question is also a little bit: Well, you know, what does the government has to do it? I wish the French admission has to do with this partners have to do with that? You know, there's definitely, I would say, almost all of it, which is really thanks to this incredible new generation of relentless and talented entrepreneurs. But I don't think you can also downplay the role that a government plays when it comes to nurturing that startup ecosystem. Because if you think about it, you know, we are kind of like, everybody's HR director to a certain extent, right, like, education in France is public, which means that French government educated every single French employee that they have on their payroll, we're kind of like the CFO as well, almost a good 90% of these to French startups have had some form of financial backing from the French government, everything from subsidies to tax credits to direct investment. And the entire regulatory environment of French startups is up to governments as well. And considering how deep tech heavy, the French shake ecosystem is, that means quite a lot. So it's really been, you know, I'd say, like a partnership over the last few years trying to make sure that we begin, we get a lot better at listening to startups, and startups get a lot better, as well as being able to work with us. So we can sort of take the whole ecosystem forward.

Andrea FORT  6:52  

Yeah, I understand that. And I know that France is one of the very few countries in the world, actually, that has the national strategy, a French tech of bolstering something like this.

Kat BORLONGAN  7:01  

No, that's true. The French tech mission, which is my team, is just entirely dedicated to French startups. And under the leadership of Cedric Oh, who is our State Secretary for digital affairs, it doesn't really have a direct equivalent in any country in the world, perhaps maybe Israel, in the sense that we serve as the sort of headquarters of the entire government around that one objective, which the President set for us, which is to make sure that by 2025, we have at the very least 25, unicorns, and that on the way there, we did not sacrifice our values within sacrifice progress, we can't sacrifice diversity, we didn't sacrifice the environment. And in order to do that, you need a little bit of everything right, you need the Ministry of Education and and Ministry of Labor, when it comes to developing and acquiring talent, you need the Ministry of Foreign Affairs for everything that has to do with, you know, economic diplomacy, and also making sure that France is really strong image abroad, you need, you know, lots of information, even like the Ministry of Health or the Ministry of Defense in the sense that they're also some of the biggest clients that startups can possibly have. And so something that's, I think, very cool about what it is that we do is that we have the privilege of being able to bring everybody together around a single strategy around a single vision which the President himself, you know, very clearly articulates. And I don't think it's every day that you, you know, you're certainly gets a president that is capable of himself, like understanding startups at such a granular level at such a precise level that he's capable of articulating that and getting everybody on board.

Andrea FORT  8:48  

Definitely, it feels like a strong objective. And, and we're seeing it now in the US as well. I mean, La French Tech hubs here in the US. What do you think about that?

Kat BORLONGAN  8:58  

Well, I know I'm not supposed to have any favorites, but the French tech communities in the US have been incredible. Some of the oldest ones are San Francisco, New York, LA. More recently, we've had Austin, Research Triangle, Miami, Boston, and there's just such a wonderful group of people to work with. So you know, they're composed mostly of entrepreneurs. So we have quite a lot of French tech entrepreneurs who you know, when they raise from U.S. investors, one of the founders goes to the US opens an office there stays close to their board members. We also have quite a few VCs, actually, who have had, you know, headquarters in in San Francisco or New York. And also just like lots of people who either worked for French startups abroad or who are French and worked for American startups in the US that really come together. So yeah, they do a lot of really amazing things like everything from helping our companies when they go to the US really, you know, connect with local ecosystems they're finding from finding clients to finding daycare for their kids. They're also really great. I think that being ambassadors for what French tech is what it's become, and when it's about to be. You know, it's really amazing, I think, for us to have that level of representation at a grassroots level, as opposed to, you know, always only counting on government. And they have like, lots of activities as well, where they bring people together, friendship, New York is actually doing this really great conference towards the end of the year, that we'll talk a little bit about, you know, franchise presence in the US. And, you know, for talent that exists all over the world. 

Andrea FORT  10:45  

I've also heard that the French government has helped in providing French tech pieces as well, I think that's fascinating. Tell me more about that. 

Kat BORLONGAN  10:53  

Yeah, I mean, so it was actually my very first project when I was appointed director of the French Tech mission. I remember how it happened. I was the very first time I was going to speak publicly. The President was with me on that day, which was incredible, almost 3000 people in the room. And onstage, he said that the French state visa was so important. Bringing international talent to France was so important, making sure that, you know, France as a country was open to the best tech talent from all over the world. He sort of just said it kind of casually on stage. And then in three months, it was done. So it was done in three months, France has the most open tech talent visa in the world, quite literally, any startup from France, in France, actually, including American startups who have an office in France, can bring talent from anywhere in the world, regardless of their diploma, and ensure that that person and their families can get to France in a matter of days or weeks with renewable residence permits up to four years. 

Andrea FORT  11:57  

That is an incredible initiative. And in bringing people in you have more influences, you have people from different backgrounds, I imagine. I mean, I'd really do love that it has become a diverse label, actually, with help with, you know, the French tech visa. And I wanted to ask you about, you know, something we hear a lot today is women in tech. I want to know about the representation of women in the startup tech industry, and how this has sort of changed over time. I mean, you yourself as a woman in this industry, you've lived things, you've seen things. Now that French tech is international, how are these objectives met? or How are things changing in the industry?

Kat BORLONGAN  12:43  

Yeah, I think we probably should start off by saying that, you know, the current state of affairs is pretty devastating. Only 13% of companies with female founders, sorry, 13% of all of the funds raised in France are, you know, raised by companies with female founders, up to today, we have, sort of ranking of the 120 top late stage companies in France, and out of the 120, only three have female CEOs. This is obviously a big issue. We know one sort of glimmer of hope is that, you know, while the numbers are quite stark, when you're looking at late stage companies, they're getting a lot better when you're looking at pre seed and seed companies, as a new generation kind of comes in. There is this very remarkable initiative that was launched by a nonprofit that's very close to my heart. They're called SISTA. And they bring together a lot of well known female founders in France. And what they did is that they brought together every single VC in France, including BPI France, which is the French public bank, and also the biggest LPs in France today. And they had them sign a pact. And it's called the SISTA pact. And it essentially tells them that in order to make a difference, and things that count, you need to count. So that means that almost every single VC in France, at the end of the year will be showing their numbers as to how many showing how many, you know, female founded startups they accepted to meet with out of that number, how many do they actually invest in what amounts and things like that, so we can actually start to really understand the problem. And also so anyone who has unconscious bias can start to see for themselves if they're part of the problem, or if they're going to be part of the solution.

Andrea FORT  14:31  

Absolutely. I think that's essential to monitor and to be cautious. Like you said, I think that's really the objective of this initiative. That's wonderful to hear. And I read something about how, you know, you also have these other objectives where the French tech only sponsors events that have 35% or more female speakers, is that still something or maybe that has evolved? 

Kat BORLONGAN  14:53  

No, I mean, that was that's definitely a thing. So I'd say like a pretty significant sponsor, a lot of tech events, now back when there were tech events in France, and it is our policy that we do not speak at, we do not sponsor, we do not partner with tech events that have less than 35% of women speakers. Because we believe representation is important. And you know, we need to start somewhere. And that's where you're needed to really send a really strong message. So it's not just a policy, or it's not just something that we say is actually something that's written in black and white into the contract. So there's a clawback clause, which means that if our partners don't hold up their end of the agreement, we don't either.

Andrea FORT  15:37  

Good, it is something that is really a part of the the values actually of this initiative.

Kat BORLONGAN  15:44  

Yeah, cuz I think the thing that's tricky about women in tech is for a lot of us, it's a hashtag, it's something that we talk about. It's something that we felt deeply held, you know, kind of helpless or embarrassed about, especially, you know, especially as women, but I think that's something that we all need to start doing. And, you know, we wanted to set an example for this, in France is actually making very concrete decisions as to what are the small things that, you know, we can start to change around us that hopefully will have an impact and how everybody else deals with the issue.

Andrea FORT  16:15  

Absolutely. And if we're speaking about change, I mean, how have you seen the French startup community change? You know, besides representation, but what have been the, I guess, latest developments the last last years?

Kat BORLONGAN  16:28  

I mean, other than a global health crisis?

Andrea FORT  16:31  

I mean, that is going to create a lot of creativity, we've definitely seen during these moments, it's already happening.

Kat BORLONGAN  16:36  

I mean, yeah, it's definitely you know, given your question, that is the answer. It's very difficult to discuss any changes that the French tech ecosystem has gone through without talking about, you know, the impact that COVID has had on our ecosystem? You know, and I think that while it did raise questions regarding our ecosystems ability to maintain this momentum, if you look at the actual results from last trimester, French tech raised more actually last trimester than it did the same time exactly last year. So we're up 8.5%. And just to give you an idea of what that means, in the UK, in Germany, the total amount raised in the first in the same semester, respectively, fell by 9%, and 20%. So you know, for French check is still going strong, it doesn't mean that we don't have startups that are affected, and founders that are going through a really rough time right now. That's certainly happening. But something that we're seeing is that the crisis is in France and elsewhere, accelerating some of the Darwinian effects that are so intrinsic to the development of a high risk tech ecosystem. I think, you know, something that changes quite a bit in France, if we want to sort of compare it to the US is that in France, when, right when confinement, you know, the lockdown was announced, one week later, surgical with the State Secretary for digital d'affaires announced immediately that we were going to have a startup emergency package. And we were the first and probably one of the first country to have actually done that. So quickly. It was 4.3 billion euro package that was rolled out in the days following the announcement. On top of that, we had all of you know, the furlough schemes, we were able to accelerate payments, tax credits and things like that, to try to keep our our ecosystem afloat as much as possible to try to keep to try to preserve jobs. And that's, that's done a lot for the French tech ecosystem, and especially don't allow for the people that are in it. And I think that is, you know, one of the things where, when people have deceived us for a long time, a lot of a lot of ecosystems have sort of seen government, as you know, like a footnote to why they are in, in in Boston, or why they are in San Francisco, why they are in Paris, or why they are in Lisbon, more and more now with what's happening with a crisis and what's happening, the situation of of health care and things like that. The the impact of a government or the decisions that a government make, or the values that a government has have to have become something that is affecting decisions that entrepreneurs make as to where they're going to launch their next companies or where they're going to open their next offices.

Andrea FORT  19:27  

Right. And keeping all of this in mind. I mean, what do you now envision for the future? You know, we've talked about the past and how things are changing and how the crisis is affecting startups now. But for the future, let's say a French startup that starts and 10 years from now, I mean, what would you say? What would you recommend for their prosperity?

Kat BORLONGAN  19:47  

To French startups? 10 years from now? What will that be like? Well, my dream for the French tech ecosystem, which you know, hopefully will not take 10 years but really more like one or two is that people will think of the French ecosystem less and less Have an ecosystem of only French people in it. And really, as a kind of home for lots of different people who want to live in, you know, who wants to start up in an ecosystem that, you know, isn't one of the world's most beautiful places to live, that has great healthcare that cares about its citizens, it cares about education, that, you know, where people can be part of friends at the same time be part of Europe. And yeah, and so something that I'm really looking forward to, I think in in the months, the years to come, is seeing French tech become even more international than it already is today. And that maybe that's sort of what you're talking about in 10 years, you know, and when people think about, you know, what a French startup will look like, maybe they won't even speak French, you know, maybe they'll be from, from Kansas, and, you know, they'll have their first hire from Bordeaux and their next hire from from Munich, and they'll start up from 10 or so mellow. And then they'll become global. So you know, I think that's really that's really the dream and, and that's something that we're moving towards.

Andrea FORT  21:10  

I hope so. Look, I've had a great time speaking with you. And I'm so glad and I hope our audience now knows more about La French Tech, and thank you for coming onto the show.

Kat BORLONGAN  21:21  

No, thank you so much for having me. It was my pleasure. 

Andrea FORT  21:25  

As always, thank you for listening to FrancoFiles. If you've enjoyed this episode, subscribe and review us and make sure to drop us a comment about what makes you a Francophile. Follow us on Twitter and Instagram at Francophilespod and visit our website for more information. To indulge in more stories about French American culture, check out our partner France Amerique magazine. Stay tuned Francophiles, and until next time, à bientôt.