For a nation that embraces égalité as a core principle, France’s startup economy looks like a playground for the elite.
The nation’s most promising startups are dominated by founders who graduated from its most prestigious universities, according to new research. As a result, the founders of France’s unicorns are the most highly educated in Europe. According to a recent “Founders Factories” report by Accel and Dealroom, 81% of unicorn founders in France have the equivalent of a master’s degree, compared to 70% in Germany and 47% in the UK.
“It is still too difficult for people who are coming from different paths to launch companies,” says Clara Chappaz, director of the government body La Mission French Tech. “Which is obviously not something we want. Launching your business should be something that anyone can do and be supported and encouraged to do.”
The question of inclusion has become a central one in France given startups’ outsized impact on the economy and as the government expands its financial and political support for the sector. The government estimates that a million jobs are either directly or indirectly linked to startups and projects that number will double by 2025; for comparison, the country’s workforce is about 28m.
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Expanding entrepreneurship beyond a narrow band of society is seen as crucial for more successful companies to emerge. Diversity has also become imperative for ensuring that startups have access to the broadest talent pool possible.
“This momentum of the ecosystem, we think it needs to benefit all of society and not just certain people who are more connected than the others,” Chappaz says. “So there is a need for equal access to opportunities.”
Of course, a lack of diversity is not unique to France. Startup ecosystems around the world have grappled with — and failed — to shift founder demographics that are overwhelmingly male and upper-class. But the question of educational elitism reflects a distinct aspect of French culture.
The legacy of ENA and the Grandes Écoles
After World War II, the government felt it needed to identify and educate a specific class of elites to run the nation and its economy. The École Nationale d’Administration, a post-graduate school, was established and in the following decades, almost all top jobs in government and business went to ENA grads.
ENA was supposed to select students on merit, but over time its ranks increasingly favoured students whose parents had attended or had some other connection. In 2021, President Macron — who himself graduated from ENA — announced he was closing the school and replacing it with a programme designed to attract students from more diverse backgrounds.
Researchers have pointed out that ENA was representative of a university educational system that caused elitism to seep into all aspects of France’s economy through a system known as the Grandes Écoles.
93% of France's 40 most promising startups had at least one founder that graduated from a Grande École
Only 5% of the nation’s 3m students graduate from this network of 230 top-flight universities which are ultra-selective, require additional years of study after high school just to prepare for the entrance exams, and often include additional graduate-level work.
A 2001 study by the Institut des Politiques Publiques, an economic think tank, found that while the entrance exams were supposed to promote merit-based admissions, almost two thirds of students at Grandes Écoles came from a “very privileged social background” and that students from Paris represented 40% of the most selective Grandes Écoles.
Jen Schradie, a digital sociologist at Sciences Po (one of the Grandes Écoles), analysed the companies on the government’s annual French Tech Next40 list of the most promising startups and found that more than 93% had at least one founder that graduated from a Grande École.
Schradie’s study also found that having a master’s degree in engineering or business was by far the most common educational background for startup founders in France.
“In France, startups are creating new types of work, but their founders come from the traditional educational mold which replicates existing inequalities,” Schradie writes in her upcoming book.
Elitism in other countries
While it’s difficult to find directly comparable statistics to other ecosystems, it appears that France’s tech ecosystem is having a more difficult time shaking its elitist image.
In the UK, for instance, elitism is also a politically sensitive issue. In a 2019 report, the Sutton Trust studied the influence of the UK's top two universities, Oxford and Cambridge. While more than half of government ministers attended one of them, only 12% of tech CEOs did.
Likewise in the US, the symbiotic relationship between Stanford University and Silicon Valley is legendary, with PitchBook ranking it as the single largest source of startup founders in the world followed by the University of California at Berkeley. Silicon Valley has long been criticised for an insular culture dominated by white male VCs and founders, which tends to be self-reinforcing, excluding women and minorities. Yet a study by the National Foundation for American Policy found that 55% of unicorns in the US had at least one immigrant founder, suggesting it is somewhat possible to break into those circles.
Coralie Chaufour is the Paris-based general manager for Entrepreneur First, a startup incubation programme originally created in the UK. The programme is unique in that it doesn't look for people with a startup already, but the best and brightest in society who want to find a cofounder and build a company.
London and Berlin are more multicultural cities than Paris... [there] it’s like people have followed a very typical path
Chaufour says that while it's hard to quantify the differences between ecosystems, it’s clear when she visits startup events in London and Berlin there is a more multicultural feel than in Paris. Since expanding to France in 2018, Entrepreneur First has invested in 60 companies.
“London and Berlin are more multicultural cities than Paris,” she said. “When you go there and you meet investors and you meet founders, I feel like these are people from different parts of the world and who have done different things. Whereas in Paris, it’s like people have followed a very typical path.”
Maya Noël, managing director of startup and VC association France Digitale, says that graduates of Grandes Écoles form tight networks that are hard for others to crack.
“You're inevitably favoured if you went to school in Paris and one of the Grandes Écoles,” she says. “You have direct, easier access to networks of decision-makers who can more easily finance you or find you customers. Which is the key to developing your business.”
Breaking down barriers
La French Tech’s Chappaz said she believes educational background is only one of many factors impacting diversity in the French tech ecosystem, citing gender and geography as other key elements. For instance, she notes that women represent 50% of the students at top business schools, but create less than 10% of the startups that raise money.
“The Grandes Écoles might be part of the reason, but it’s not the only factor because otherwise, you would have companies that are representative of the Grandes Ecoles in the French tech ecosystem, and that’s not the case,” Chappaz said.
Still, to address the elitism dynamic, three years ago La Mission French Tech created a programme called Tremplin (trampoline) which seeks to support entrepreneurs from a far wider range of economic, social and economic backgrounds.
That includes refugees, people living in underprivileged areas or rural communities. Race is not officially one of those categories because the French government does not recognise it, and even goes so far as to prohibit the collection of any race-based information by bureaucrats and researchers.
Women represent 50% of the students at top business schools, but create less than 10% of the startups that raise money
Between 300 to 400 people are selected to participate each year in a six-week boot camp to spur ideas and product development. That is followed by placement in one of the more than 100 incubators, plus a €22k stipend.
The statistics are encouraging: more than 93% of the projects from the first season are still operating, with about half having hired other employees and 20% having raised some money.
Beyond the money, Chappaz says the key is giving such founders access to the networks where recruiting and funding happen.
“It’s the same for women, it's the same issue outside of Paris, and it's the same if you're coming from an underprivileged background,” Chappaz said. “You probably have less access to the right people to raise money or to get accepted to an incubator. The idea is to remove some of the barriers for them to start their companies if they have an idea.”
Boosting alternative entrepreneurs
One of the most famous exceptions to the French elite entrepreneur rules is Xavier Niel, the telecoms billionaire who is one of the nation’s biggest startup investors and spent more than €200m of his own money building the Station F startup campus.
Niel dropped out of school in the 1980s to start his first company and developed a strong critique of the rigidity and exclusivity of French education. To create a more merit-based approach, a decade ago he founded École 42, a free programming school that selects students purely on the results of a coding challenge and does not have teachers or a formal curriculum.
Ten years in, École 42 has educated more than 37k students across France and 29 other countries. Alumni founders have raised €148m over the past three years for 52 different startups.
“In France, as in the US, if you come from a wealthy family then you will succeed,” Niel said. “But the best programmers can come from anywhere. They just need a chance to succeed.”
Niel’s Station F has a more complicated relationship with France’s elites. Schradie’s study notes that when Station F first launched, it partnered with three business schools, including two Grandes Écoles: HEC and EDHEC. Three engineering Grandes Écoles — CentraleSupélec, École des Ponts Paris Tech and Télécom Paris — have incubators at Station F.
In France, as in the US, if you come from a wealthy family then you will succeed. But the best programmers can come from anywhere" — Xavier Niel
At the same time, Station F created its Fighters Programme in 2018, which provides training and introductions to potential investors and customers to founders from “underprivileged and underrepresented backgrounds”. It's has worked with more than 100 startups, and this year dramatically expanded the scope to work with another 1,000 by 2024.
Efforts to address the social gap continue to multiply. In 2019, Bpifrance created a programme called CitésLab, a network of more than a dozen accelerators run in partnership with cities for entrepreneurs from low-income neighbourhoods. Two years ago, former Publicis chairman Maurice Lévy created L'Escalator, an incubator that promotes inclusion by helping entrepreneurs from disadvantaged backgrounds develop their ideas, connect with mentors, find partners and get introductions to potential investors.
Mounira Hamdi and Anthony Babkine, the first in their immigrant families to attend university in France, saw just how much those credentials and connections could matter. They met more than a decade ago while pursuing their masters at Paris’s Institut Mines-Télécom Business School — a Grande École.
A few years later they formed Diversidays to provide the opportunities they had to people who didn't attend an elite institution or have family connections. The association’s offering includes a programme to teach entrepreneurs essential skills like pitching, presenting, product development, promotion and fundraising.
Babkine was pleased when Macron stopped by a presentation of startups in its programme at the recent VivaTech conference. But while he acknowledged the efforts underway to address the clubiness of France’s startups, he says much more needs to be done to make the promises of equality real in the sector.
“We have a big problem in France,” Babkine says. “By 2030, the tech ecosystem will be the first employer in France and in Europe. So we must help everyone find their place in this economy.”