Greentech, spearheading the increase in turnover of French start-ups

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In 2023, French start-ups saw their turnover increase by 18% year-on-year. An increase which can be explained by the fall in fundraising, in a context marked by an economic slowdown.

Disparate results depending on the sector

These are the results of the Banque de France's annual report on the financial situation of start-ups. The institution was interested in a sample of 2,295 companies having recorded a turnover greater than 750,000 euros in 2022 or 2023, and/or fundraising beyond 3 millions of euros. It distinguishes start-ups from VSE-SMEs by “ strong growth potential, the use or creation of a new technology ”, as well as “& ;nbsp;a need for financing often ensured by fundraising “.

First observation, the rate of increase in turnover of start-ups is almost three times higher than that of VSEs and SMEs. Greentech, that is to say « the sectors of energy, environment  ”, as well as mobility, obtained the strongest growth: +27 % and +39 % increase in their income respectively.< /p>

These sectors are followed by food (+25%) and education and human resources (+24%). On the other hand, fintech and IoT and hardware fared poorly during 2023, recording slight increases of 7% and 5%. « Despite a difficult economic situation marked by the fall in fundraising and the significant drop in valuations, the sector continued to hire (mainly at the end of the year), and continued to 'internationalization and digitalization of its activity », reassures the Banque de France on the subject of financial technologies.

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Less successful fundraising for start-ups

The increase in turnover hides a less encouraging reality. Fundraising fell by 38% last year. ” Entrepreneurs seem to have adapted their management to this situation by getting closer to their break-even point to preserve their cash flow without sacrificing growth in activity and jobs “, comments the organization. Here too, it is greentech which has the most operations, ” in number and in amount “.

The sector continues its strong breakthrough at the start of 2024, dominating all fundraising alongside artificial intelligence (AI). On the other hand, financial technology funding rounds recorded a drop of 6% between June and January compared to the same period of the previous year.

More failures… and more hiring

The Banque de France also noted negative operating results for start-ups. They have a total of 5.6 billion euros in losses. This situation has led to a surge in insolvencies: 76 start-ups were subject to reorganization or judicial liquidation in 2023.

« The profile of failing start-ups is characterized by an absence of equity, the presence of heavy losses, weakness of their treasury ,” the report states. “ One in five failures concerns a start-up in the health sector ”, he continues.

On the positive side, start-ups in Pays de la Loire, Burgundy-Franche-Comté and Brittany are recording remarkable growth in recruitment. 60% of positions are nevertheless filled in the Île-de-France region, 9.6% in Auvergne-Rhône-Alpes and 7.3% in Occitanie. The companies studied by the Banque de France employed 8,000 additional people in 2023 compared to the previous year.

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