2023-10-26 16:05:00
After a somewhat euphoric year in 2022, the dynamics of fundraising fell in 2023. And the third quarter confirms the trend of the first two: according to Patricia Braun, the president of In Extenso who comments on the fundraising barometer established by his office, “fundraising remains more complex and time consuming due to the context of rising rates and therefore a search for profitability on the part of financiers. Although seed funding in France remains dynamic (+29%), the situation is nevertheless difficult for many startups, making it necessary to maintain or even amplify public support systems for innovation.
Thus, during the first nine months of 2023, the amounts raised fell by -41% in France and -36% in Europe (with respectively 6.8 billion euros and 39.5 billion euros raised by Tech French and European) compared to the amounts recorded over the same period in 2022. The flow of operations increased slightly by +7% in France (714 deals completed) and +11% in Europe over the period (4,993 deals in Europe). However, during the third quarter, the contraction eased slightly (2.3 billion euros raised, down only -10% compared to Q3 2022), mainly due to the Verkor operation of 850 million euros.
Search for profitability
Since the start of the year, fundraising has been marked by a financing crisis resulting from a sharp decline in mega fundraising, but also by a re-allocation of funds towards seeding and disruptive technologies (deeptech). and some strategic sectors such as cleantech (energy in particular) and health.
This is probably why the Occitanie region stood out with 28 fundraising operations (6.6 million euros average ticket, down 21%), an increase of +27%, for a total raised which remains stable at 185 million euros (+1%).
« We observed a drop in the valuation of companies listed in SaaS or marketplaces – they were valued at more than 20 or 25 times the annual recurring income and fell to 5 or 6 times the annual recurring income – therefore many players who had invested at the top of the cycle took significant losses and exited the market, deciphers Rodolphe Lilamand, director at In Extenso Innovation Croissance. On the late stage, there are today fewer investors, they are becoming more selective and looking for profitability… This is why projects which have difficulty showing profitability in the short term will have difficulty in finance, with the exception of projects around “hype” subjects such as AI, cleantech and deeptech. Deeptech projects need to be supported by research teams or laboratories whose regional network is better distributed, and Occitanie is doing well with the financing of great deeptech or cleantech projects. »
Cleantech and deeptech: the wind in its sails
The fields of energy, transport and software allow Occitanie to preserve a certain dynamic during the first nine months of the year. As on the national level, it is the seed fundraising (less than 1 million euros), multiplied by six, which has driven the regional dynamic. According to the In Extenso barometer, “ cleantech and deeptech are doing well with respectively an increase multiplied by 3 and multiplied by 2 in the amounts raised ».
This is how the Toulouse startup Ascendance Flight Technologies (hybrid propulsion system in favor of the decarbonization of air transport) raised 21 million euros in March, the startup also from Toulouse EyeLights (augmented reality windshield and head-up display) 20 million euros in April, the Montpellier group Médiprix 16 million euros in July to boost its digital project, FHE Group in Perpignan (solutions dedicated to thermal, energy and photovoltaic comfort for housing) 15 million euros in September, and the Toulouse biotech Pili (which aims to decarbonize the textile industry) 14.5 million euros in March.
Among the main fundraisings of the third quarter, In Extenso is Bonx (Toulouse) which achieves a first round of 500,000 euros for the development of its customizable ERP software thanks to “no-code”, Abelio (Toulouse) who raises 2 million euros for its SaaS to help with crop management (with the support of regional funds), Aviwel (natural and sustainable solutions to improve the growth of livestock) in Toulouse which is carrying out a seed round of 4.5 million euros, or the Toulouse startup Reev which raises 1.5 million euros for the industrialization of its robotic knee brace to alleviate the after-effects of stroke.
Haute-Garonne and Hérault, locomotives
Ultimately, over the nine months, the Occitanie region ranks 5th in terms of amounts raised and number of operations, behind Ile-de-France (1st position), Auvergne-Rhône-Alpes (pulled upwards). by the raising of Verkor), Paca and Nouvvelle-Aquitaine (the latter two alternating 4th and 5th place depending on whether we are talking about the amounts raised or the number of operations). But In Extenso describes Occitanie as “ most dynamic region in France in terms of amounts raised and number of operations”.
The amounts raised for Deeptech have been multiplied by two, cleantech financing by three, and seed financing by six. Regional investors were strongly mobilized in the funding rounds such as IRDI, MCapital, Aris, Nord Midi Pyrénées Développement and Ocseed.
Over these nine months, the fundraising market was, unsurprisingly, driven by the departments of Haute-Garonne (13 deals for 99 million euros raised) and Hérault (11 deals for 53 million euros raised). euros raised).
In conclusion, the In Extenso barometer underlines that “ the investment support systems deployed by public authorities will nevertheless prove decisive in helping startups, in the coming months, to get through this degraded economic situation ».
« The pressure is put on by investors to achieve profitability, and players who have an EMP to repay or a significant amount of debt are in the process of stopping, so we are observing an increase in the loss ratio of startups and SMEs to return to the level historical, adds Rodolphe Lilamand. It is therefore advisable to put in place preventive procedures to anticipate any cash flow problems and get back on the path to possible profitability. »
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