It’s no mystery that as a company, innovation gets all the more challenging the bigger you get. “Startup” is more or less synonymous with “innovative,” whereas “company” starts to make you think of “hierarchy,” “bureaucracy,” and the likes. There are many examples of where larger companies struggle to implement even the smallest of changes. Which probably explains why there are numerous articles dedicated to the topic of how to keep companies innovative as they grow (I’ll come back to this in a minute).
I’ve mentioned in numerous other articles that I’ve written about how Europe may seem a little acquisition averse. I mean yes, naturally there are companies that acquire – even in France. And Europe and France have also seen their fair share of larger acquisitions, too; just think back to when SAP paid $6.8 billion for Business Objects in 2007. Then again, there aren’t an overwhelming number of examples to choose from.
Still, French startups aren’t exactly complaining about not being swallowed up by some of the more traditional old-timers. They know that being acquired by a business dinosaur could put their product and business on life support, even if an acquisition is financially appealing. After all, that type of thing happens even with acquisition poster child, Google. Therefore, the line between large corporations and startups is almost all too well defined.
I often get approached by people from larger French companies who want “advice on dealing with startups.” Uh…seriously? My advice is remove your tie, attend a Startup Weekend event and get your hands dirty a little bit!
Innovate…but only while you can.
That said, larger companies still manage to maintain a far too friendly distance – and more often than not end up trying to replicate startup ideas rather than collaborate. For example, even though dating giant Meetic has made some acquisitions (like ClearGay), I was surprised to find it launching its own VIP site in 2009 rather than piggy-backing onto AttractiveWorld, which launched in 2007. The same could be said of examples concerning e-commerce companies and Vente-Privée. Yes, sad but true.
This recently happened with a French startup called FriendsClear, a P2P lending site that looks a lot like US-based LendingClub - except that it’s specifically targeted at entrepreneurs. Ah yes, on a continent where VC funding hardly rivals that of Sand Hill Road, this little startup dared to create an innovative funding platform.
Founded in 2008, the site took a small 4% commission on the reimbursement payment of the different projects that it funded – which may not have amounted to the equivalent of million euro VC investments, but still did manage to help a handful of startups and entrepreneurs. In fact, FriendsClear was in many ways no different than crowd funding platforms Kisskissbankbank and Ulule (except that the model is more about “lending” than “donating” or “buying).
But the activity of the site was forced to be put on hold as of late 2010 by their financial partner and French bank Crédit Agricole. The reason? France’s central bank, La Banque de France, wanted to integrate a few changes to the company’s concept…which they clearly found interesting.
I’m sorry, do you mind if we steal your idea?
FriendsClear struggled ever since and only recently did it become clear why. On Feburary 17, RCI Banque (Renault) launched this great new innovative platform called Zesto. The irony is that it is strives to be more or less a copy of FriendsClear.
Some French entrepreneurs, like MyID.is founder Charles Nouryit, were outraged to see yet another French company copying an innovative startup rather than collaborating or – yes, you guessed it – acquiring it.
All in all, I’m rather horrified by what I’ve heard regarding this situation. FriendsClear definitely had a very promising goal. I’ve reached out to the founder Jean-Christophe Cappelli to comment and will keep you posted concerning the details of the situation. Regardless, I am very pleased to see that the site is still up and running and that there are still projects to fund!