Central to this changing of the digital guard are contrasting strategies by London and Paris in their dealings with startups, venture capitalists and some of Silicon Valleys biggest names, according to industry insiders, senior policymakers and tech executives, many of whom spoke to POLITICO on the condition of anonymity because they were not authorized to speak publicly.<\/p>\n
In Britain, the governments central focus on leaving the European Union<\/a> has seen many of its ties to the local tech sector downgraded, with reduced access to Theresa May and senior officials, as well as vocal efforts by U.K. policymakers to clamp down on the perceived wrongdoings of tech giants such as Google and Facebook.<\/p>\n \u201cTheres now more pace there than in London. That was unthinkable even two years ago\u201d \u2014 Fr\u00e9d\u00e9ric Court, venture capitalist <\/em><\/p>\n<\/blockquote>\n Yet in France, Emmanuel Macron, the countrys popular \u2014 and English-speaking \u2014 president, has led a one-two regulatory punch<\/a> that involves rewriting onerous domestic legislation, including its local labor laws, and making demands, often behind closed doors in one-on-one meetings, that multinational tech companies pay more tax into national coffers.<\/p>\n This carrot-and-stick approach has led many U.S. tech moguls<\/a>, including Facebooks Mark Zuckerberg and Ubers Dara Khosrowshahi, to visit Paris in efforts to woo Macron, including via announcements for new research centers and tech jobs across France. The VivaTech gathering in Paris earlier this month drew more than 50 tech bosses; Macron informed them they would be receiving \u201cno free lunch\u201d while in France.<\/p>\n In contrast, many of these same executives now skip similar lobbying trips to London as the countrys power to alter the EU tech landscape wanes ahead of the U.K.s departure from the bloc early next year. Their absence will be most acute during London Tech Week<\/a>, a series of events starting Monday aimed at promoting the British capitals digital prowess.<\/p>\n \u201cIn the past 10 years, theres been amazing work done to make London the center of the European tech ecosystem, but with Brexit, that has stopped,\u201d said Fr\u00e9d\u00e9ric Court, a French venture capitalist who has spent much of his working life in London.<\/p>\n \u201cThe momentum has shifted to Paris,\u201d added Court, who as a partner at Felix Capital<\/a>, invested in billion-euro EU startups like Deliveroo, an online food ordering service, and FarFetch, a high-end digital fashion retailer. \u201cTheres now more pace there than in London. That was unthinkable even two years ago.\u201d<\/p>\n Macron visits the digital museum Micro-Folie with children of the town council in Les Mureaux | Ludovic Marin\/AFP via Getty Images<\/p>\n The digital winds may have shifted toward France, but tech executives and even some of the countrys own officials acknowledge theres still work to be done before Paris outmuscles London as the first among equals within Europes tech hubs.<\/p>\n Last year, for instance, French venture capitalists raised a record \u20ac2.7 billion,<\/a> the first time the country bested similar figures for the U.K., whose local funds pocketed \u20ac2.5 billion in 2017, according to Dealroom, a data provider. Much of that capital in France came from local multinationals eager to understand how tech may eventually upend their industries.<\/p>\n This tidal wave of new French cash, though, was not matched with similar levels of investment. Despite the uncertainty of Brexit, international backers plowed a record \u20ac7.3 billion<\/a> into the British tech sector last year \u2014 roughly three times the amount earmarked for French competitors, according to Dealroom.<\/p>\n \u201cWhen companies want to raise more than \u20ac30 million, they still have to leave France,\u201d conceded Roxanne Varza, director of Station F<\/a>, a sprawling startup incubator in central Paris, which has partnered with the likes of Facebook and BNP Paribas, the French bank, and was created by local billionaire Xavier Niel.<\/p>\n Frances emergence as a potential contender to dethrone the U.K. in all things tech coincided with one crucial event: Brexit.<\/p>\n In the wake of Britains decision in 2016 to leave the European Union, including Theresa Mays promotion to prime minister, tech industry insiders said their access to the corridors of power in Britain was shut off, almost overnight.<\/p>\n Where David Cameron, the countrys former leader, held monthly breakfasts with local startups and venture houses to gauge their opinions, these get-togethers have become a rarity under May. Tech companies \u2014 most of whom had overwhelmingly supported staying inside the EU \u2014 also were held at arms length and viewed initially with increased suspicion under her administration, according to several executives who spoke to POLITICO.<\/p>\n \u201cWhat has changed is there is a lack of special treatment for tech\u201d \u2014 Will Tanner, former deputy head of Theresa Mays policy unit<\/em><\/p>\n<\/blockquote>\n That included difficulties in securing government meetings to address key concerns over Brexit, such as continued access to European tech workers and EU research and investment funds. Some executives added they were dismissed as part of a cosmopolitan global elite, something that May worked actively to distance herself from during her initial months in Downing Street.<\/p>\n \u201cWhat has changed is there is a lack of special treatment for tech,\u201d acknowledged Will Tanner, former deputy head of Mays policy unit, who left No. 10 following last years snap general election. \u201cThe government is concentrating on lots of different sectors in the economy.\u201d<\/p>\n A British government spokesperson did not address these claims, but added the country is still central to Europes tech industry.<\/p>\n Sensing an opening, Macron \u2014 always eager to portray a more outward-looking picture of France \u2014 moved fast after winning the countrys presidency in May 2017.<\/p>\n Last June, he unveiled a series of tech programs<\/a> aimed at enticing international companies and talent to Paris and other French cities, many of which have existing talent pools of coders and programmers that previously had to look outside the country for well-paying jobs.<\/p>\n Macron has created a fast-tracked international tech visa system<\/a>, announced a \u20ac10 billion national innovation fund<\/a> and outlined plans to streamline the countrys corporate tax and labor laws<\/a> to make it easier for companies to hire staff and issue stock options to new employees.<\/p>\n Macron with British PM Theresa May | Stefan Rousseau\/Getty Images<\/p>\n \u201cNot many heads of state have put digital issues at the heart of their action,\u201d said Gilles Babinet, the French governments so-called digital champion at the European Commission. \u201cMacron is out there selling France as a hub for artificial intelligence. Every time he goes to a foreign country, hes making the pitch personally.\u201d<\/p>\n The French president has also positioned himself as the main instigator behind Europes renewed push against Silicon Valley at a time when public opinion worldwide has begun to shift against the likes of Facebook and Amazon. That includes efforts, so far unsuccessful, by Paris to force tech giants to pay taxes on revenues, not profits<\/a>, generated within the EU \u2014 a potential major shift in how taxes are paid worldwide.<\/p>\n \u201cIt is not possible to have free-riding on one side, even when you make a good business,\u201d Macron told tech bosses<\/a> at the VivaTech conference in Paris last month.<\/p>\n Frances double-headed strategy began to pay off with the likes of Google announcing<\/a> an artificial intelligence research center in Paris and Amazon saying it would increase<\/a> its local workforce by 50 percent, to 7,500 workers, by the end of 2018. Industry executives said such investments would likely have happened without Macrons clampdown on tech, though the timing of the announcements, many conceded, was aimed at soothing Paris regulatory ire.<\/p>\n Frances government-backed tech push did not go unnoticed in Britain. Facing renewed competition, British politicians last summer started to rethink their hands-off strategy to the countrys digital sector.<\/p>\n With questions swirling about the U.K.s future after Brexit, the shift by local policymakers is also aimed at positioning the countrys successful tech industry \u2014 arguably the largest in Europe \u2014 as a potential engine for growth after Britain leaves the bloc, according to government insiders and tech executives.<\/p>\n These renewed efforts to reach out to the British digital sector included announcing a doubling of the number of visas available<\/a> for the tech and creative industries to 2,000 per year, a multimillion-pound investment<\/a> to jumpstart artificial intelligence research in the U.K. and an industry gathering in Downing Street in November where May reaffirmed her commitment to tech. Government officials say more events are now planned.<\/p>\n Macron and May in Camberley, Britain| Andy Rain\/EPA<\/p>\n The U.K. governments relationship with industry \u201cstarted a bit cooler in the early stages,\u201d said Antony Walker, deputy chief executive of techUK, a trade group. But, he added, \u201ctheres a growing recognition and understanding of the importance of having a strong digital sector.\u201d<\/p>\n While the rivalry between France and Britain dates back centuries, officials on both sides of the Channel have tried to play down a winner-take-all view on Paris recent emergence as a competitor to London. They suggest that both countries can mutually benefit from increased EU-wide tech investment \u2014 a key component if Europe is to keep pace with the likes of the United States and China, which remain the undisputed leaders in the global tech race.<\/p>\n \u201cIt isnt a zero-sum game,\u201d said Matt Hancock, the British secretary of state for digital, culture, media and sport. \u201cA strong France leads to a strong U.K. when it comes to tech investment.\u201d<\/p>\n Nicholas Vinocur contributed reporting.<\/em><\/p>\n CORRECTION: This article has been updated to clarify which tech CEOs have come to visit Paris.<\/em><\/p>\n Original Article<\/a><\/p>\n [contf] [contfnew] LONDON \u2014 Move over Britain, theres a new European tech champ..<\/p>\n","protected":false},"author":1,"featured_media":82444,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[50],"tags":[],"class_list":["post-82443","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-tech"],"yoast_head":"\n\n
![](\"https:\/\/www.politico.eu\/wp-content\/uploads\/2018\/06\/GettyImages-921251720-714x476.jpg\"\/)
<\/p>\nAnd then came Brexit<\/strong><\/h3>\n
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France takes center stage<\/h3>\n
![](\"https:\/\/www.politico.eu\/wp-content\/uploads\/2018\/02\/GettyImages-906692138-714x476.jpg\"\/)
<\/p>\nBritain tries to regain momentum <\/strong><\/h3>\n
![](\"https:\/\/www.politico.eu\/wp-content\/uploads\/2018\/01\/h_54022827-714x443.jpg\"\/)
<\/p>\nRead this next: 12 Brexit cherries the UK wants to pick<\/a><\/em><\/h2>\n
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