Beyond the French Tech, let's create European digital champions

Hexa (eFounders) founder Thibaud Elzière argues that the European Union needs to take initiative to ensure that entrepreneurs have the resources and capabilities to innovate and grow at high speed.
Beyond the French Tech, let's create European digital champions

ChatGPT has gained considerable attention, even among the tech community used to impressive advancements. However, it's important to remember that this technology is built on American data, rules, values, and perspective and so it inherently reflects the cultural backdrop from which it originates.

The increasing presence of chatbots such as ChatGPT, Google, and Facebook will inevitably carry this cultural influence. This is why it is crucial to create European alternatives to maintain cultural diversity and respect for our unique sensitivities.

Cultural Influence

The cultural influence on algorithms is just one aspect of technology where differences between Europeans and Americans can manifest. Approaches to data management, privacy, copyright, societal and environmental requirements are evolving, sometimes significantly. However, our identity, privacy, work, health, communication, and information channels, as well as critical energy, defense, and transportation systems, are all reliant on digital technology.

If we wish to uphold our own values, we cannot depend on technologies that do not align with them. It is therefore crucial to establish digital sovereignty—a technological ecosystem that safeguards our freedom to evaluate, decide, and act on key matters.

The notion of technological sovereignty might seem difficult to achieve given that the majority of software, hardware, components, and essential expertise are concentrated in the United States and China. However, are these limitations insurmountable? Are we destined to rely indefinitely on nations that prioritise their own interests over ours? Not necessarily!

As artificial intelligence and quantum computing have quickly transformed landscapes that once seemed unchangeable, innovation has the potential to bring unexpected changes in record time.

To drive disruptive innovations that can tip the scales in our favor, we need powerful driving forces. The FAANGs are key to American technological dominance. They exert a strong gravitational pull that attracts investment, data, and talent. They shape, if not impose, norms and practices. They acquire emerging competitors and promising innovations and expand their empire while stifling alternatives.

These giants are more than mere corporations, they govern our lives by their own rules.

To challenge them, we need powerful players capable of anchoring a sovereign digital ecosystem. For them to thrive, they require the resources of a vast market. The national level is too confined for them to prosper but Europe, on the other hand, offers a critical mass and cultural cohesion that are far more conducive to their success. This is where our efforts must be directed.

Frameworks and Steps

With the GDPR, the Digital Service Act, and the Data Act, Europe is demonstrating its determination to establish a specific framework for the digital sector that upholds its values and principles. Such a framework is essential for companies that comply with it. However, to quickly produce its own digital champions, Europe must also adopt a proactive support policy. This could be based on four key pillars.

To have the strongest strike force and avoid counterproductive internal competition, it's essential to consider, decide, and coordinate all initiatives at the continental level. Although “La French Tech”, the French government initiative to support startups, has been beneficial to the development of technology and the viability of French tech companies, it can no longer stand on its own. Its Franco-centric model has intrinsic limitations that a European initiative will help overcome. Support for tech companies should be pooled at the European level - this is the first step in creating international legitimacy.

Secondly, the European support policy should focus on providing entrepreneurs with a stable, clear, and protective administrative and regulatory framework, as well as financing facilities.

It is important to remember that great successes in the technology field are often the result of visionary entrepreneurs.

Therefore, the best approach is to provide them with the necessary means and freedom to realise their ideas, without any unnecessary interference.

Thirdly, in order to encourage the expansion of European companies and enable them to compete from the outset with their potential American or Chinese competitors, it is essential to strengthen the unity of the internal market. One way to achieve this is to create a European company status, which would abolish the need to open a subsidiary in each country to operate throughout the Union.

A few formalities would suffice to set up a business anywhere and expand rapidly. This single status would also benefit investors by providing a standard framework.

Finally, a fourth pillar of support for startups would be the creation of a European stock exchange. One of the major challenges for startups is to enable their initial investors to recover their investment, either through a buyout or an IPO. However, as long as Europe does not have its own industry giants, the Americans will continue to dominate.

Therefore, we could create a pan-European market that can offer liquidity to the whole continent, preventing innovative companies from leaving for the Nasdaq. Such a market would also allow European savers to own shares in companies that own their data, creating a form of popular and sovereign shareholder control. Finally, it would require listed companies to comply with European regulations while preserving their original specificities.

After the Second World War, European states recognised the vital importance of energy, telecommunications, transport, and health sectors and largely chose to nationalise them to preserve their sovereignty. Today, digital technology is just as crucial, and it is once again necessary to protect our vital interests.

The only difference is that large public groups lack the resources, agility, and pioneering spirit to innovate and grow quickly. To create our own digital giants, we have no choice but to rely on entrepreneurs and do everything we can to assist them in succeeding.

Lead image: Robert V. Ruggiero

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