The French DGA procurement agency and Bpifrance yesterday launched an investment fund with an initial budget of €50M to support innovative SMEs and start-ups in the French defence sector, “a major issue for the sovereignty of our defence system, which is based on a strong and competitive industry,” said DGA director Laurent-Collet Billon in an official statement.
If you are probably familiar with the DGA, you may be less so with Bpifrance. The primary tasks of the BPI (public investment bank), a state-held subsidiary of the Caisse des Dépôts, are to provide financial support to companies and help them with their innovation and exports throughout their life cycle. Bpifrance relies on a strong network of 47 regional offices.
Announced by Defence Minister Jean-Yves Le Drian during the 2016 edition of the DGA’s Innovation Forum, the fund will work with “companies deemed strategic, to strengthen their balance sheet, stabilise their capital and contribute to a long-term consolidation of the defence sector,” explain the DGA and Bpifrance. But besides providing equity or quasi-equity, this fund will also have a more “active” vocation by simulating the attractiveness of companies to private investors and on the export market.
This new fund will also consolidate existing aid schemes, such as RAPID (which we wrote about here), launched in 2010 for SMEs. Sponsored by the DGA, RAPID has, in the seven years since its launch, supported more than 350 innovative projects. The only problem is that RAPID does not fund start-ups, a shortcoming that the DGA/Bpifrance fund could remedy.