Social and economic performance of French digital business startups

Social and economic performance of French digital business start-ups

Barometer 2014

Page 2

1. Methodology

2. Executive summary

3. Key figures

3.1 Revenues

3.2 Fund-raising

3.3 Innovation support

3.4 People

3.5 Value-sharing

3.6 Entrepreneur’s profile

4. Contacts

Page 3

1. Methodology

Page 4 Barometer 2014

1. Methodology

• Barometer based on data from VC-backed digital start-ups

• Survey sent by venture capitalists to their participations

• EY, as a third-party, analyzed data in order to consolidate and guarantee its confidentiality.

1165

years old

€4,8m2012

& 2013

start-ups Average age Raised since their creation (median)

Key figures from financial data

Page 5

2. Executive summary

Page 6

Hyper growth & Born global

+43% of revenues vs 2012

39% of revenues are generated abroad in 2013

+ 100% of ROW revenues vs 2012

24% of respondents have a foreign VC that already invests in the firm

People

+22% of employees in one year

91% of permanent contracts

32 years old is the average age of employees

68% of employees have from Bachelor to Master Degree

6% of entrepreneurs are women

Innovation support Value sharing46% of the sample did not use « Young Innovative Company » tax incentive

77% use French research and development Tax Credit (CIR)

French research and development Tax Credit remains the preferred state incentive

30% of employees owning equity instruments

90% of start-ups use equity instruments

2 is the average ratio between management and staff salaries

96% never distributed dividends

Page 7

3. Key figures


3.1 Revenues

• Total revenues (in €m) • Growth of total revenues (in %)Analysis by revenue segment

1,598

2,279

0

500

1 000

1 500

2 000

2 500

2012 2013

71%

20%

44%

0%

10%

20%

30%

40%

50%

60%

70%

80%

0 to 5 M€ 5 to 50 M€ + 50 M€


3.1 Revenues

• Worldwide revenues (in %) • Worldwide revenues (in €m)

72%61%

17%

21%

11%18%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2012 2013

1 1531 398

272

482173

399

0

500

1 000

1 500

2 000

2 500

2012 2013

France Europe International France Europe International

+ 21%

+ 100%39%


3.2 Fund-raising

• Average and median of fund raised (in €m)Analysis by revenue segment

• International VCPercentage of foreign venture capitalists investing in French digital business start-ups. Analysis achieved by revenue segment.

5

16

29

2

10

18

0

5

10

15

20

25

30

35

0 to 5 M€ 5 to 50 M€ + 50 M€

Average Median

13%

23%

43%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

0 to 5 M€ 5 to 50 M€ + 50 M€



* Sample of 83 companies created after 2005.

46%No

54%Yes

• Did you use the label « Young Innovative Company » (JEI)?*

23%No

77%Yes

• Did you use the French research and development tax credit (CIR)?**

** Sample of 86 companies having R&D expenses.



25%No

75%Yes

83%No

17%Yes

Tax credit for encouraging competitiveness and jobs (CICE) Innovation Tax Credit (CII)

• Did you use the new tax credits launched in 2013?



• Financing Research & Development (in €m)

• Tax controls in 2013Percentage of start-ups that had the Tax administration performing a tax control during the year*.

18%

24%

0%

5%

10%

15%

20%

25%

2012 2013

* Analysis based on a sample of 108 participants.

25 29

89

123

16

18

0

20

40

60

80

100

120

140

160

2012 2013 2012 2013

Research Tax Credit R&D

InternationalFrance


3.4 People

• People

6 190

7 566

0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

8 000

2012 2013

1376

jobscreated


91%

3.4 People

4%3%

1%

Permanent contract ("CDI")

Temporary contract ("CDD" and "Interim")

Professional training contract

Internship

68%

26%

3%

3%

From Bachelor to Master Degree

From High school to Bachelor Degree

High school Degree or less

PhD

• Type of work contracts (2013) • People qualification (2013)


3.4 People

30%+ €50m

50%€5m to €50m

20%0 to €5m

• Distribution of employees by start-ups revenues


3.4 People

• Average age of staff • Ratio Management/Staff wages

42

32

0

5

10

15

20

25

30

35

40

45

Average age Management Average age Employees

0,3

2

6,2

0,4

2

8,1

0

1

2

3

4

5

6

7

8

9

Minimum Average Maximum

2012 2013


3.4 People

89%Yes

11%No

• Are you both founder and manager of the company?


3.4 People

54%No

94%Men

46%Yes 6%

Women

• Serial entrepreneur • Gender of Chief Executive Officer


94%

are men

42

years old

46%

are serial entrepreneurs

92%

have at least a master degree

3.4 People

• Entrepreneur’s profile


3.5 Value sharing

70%Loss

30%Gain

* Sample of 94 start-ups.

• « Earnings before interests and taxes » or EBIT*

• Percentage of positive « EBIT » by revenue segment*

12%

45%

71%

0%

10%

20%

30%

40%

50%

60%

70%

80%

0 to 5 M€ 5 to 50 M€ + 50 M€

€


3.5 Value sharing

54% 46%

% of shares held by owners and employees

% of shares held by external shareholders (VC, business angels …)

• Percentage of capital shares held by owners and employees


3.5 Value sharing

90%Yes

10%No

* Analysis based on a sample of 101 start-ups.

• Are you using equity instruments to motivate your team?*


3.5 Value sharing

60%27%

13%

* Analysis based on a sample of 105 start-ups.

Warrants (BSPCE)

Free shares (actions gratuites)

Stock-options & common shares (BSA)

• Types of equity instruments*


3.5 Value sharing

* Sample of 99 start-ups.

• Percentage of employees owning equity instruments*Percentage calculated by doing the ratio between the number of employees owning equity instruments and the total of employees. First chart presents data globally and the second chart is presented by revenue segment.

28%

30%

27%

27%

28%

28%

29%

29%

30%

30%

31%

2012 2013

34%

24%

16%

0%

5%

10%

15%

20%

25%

30%

35%

40%

0 to 5 M€ 5 to 50 M€ + 50 M€


3.5 Value sharing

96%No

4%Yes

• Did you distribute dividends since the creation of the company?

Page 27

4. Contacts

Page 28

Contacts

Franck Sebag

Partner, EYVC & IPO Leader France

@frsebag

Xavier Lorphelin

Managing Partner Serena Capital

@Xlorphelin

About France Digitale

France Digitale bring together the champions of digitalentrepreneurship: start-ups with strong growth plans and potentialinvestors (venture capitalists and business angels). To build analliance between digital entrepreneurs and investors, so thatFrance becomes fertile ground for the creation ofdigital champions of International stature. For more information,please visit www.francedigitale.org.

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Economy & Finance

Social and economic performance of French digital business startups