In innovation, this valley has been swimming for a long time. It prides itself on having the highest share of jobs dedicated to R&D in France, and a record ratio of patents filed per inhabitant. A teeming ecosystem of which nothing seems able to undermine its vitality. Nor the regular pollution peaks, which worsen heatwave episodes come summer. Nor the reputation that sticks to the territory in terms of insecurity. So much so that this Silicon Valley has never lived up to its nickname so well. Miles away from its illustrious American model, Grenoble is consolidating its place in the semiconductor market. By increasing their capacities, local champions STMicroelectronics and Soitec are converting it into a stronghold for chip production on the Old Continent.
In recent years, the metropolis of 450,000 inhabitants has also established itself as a lung of the deep tech scene… These start-ups to which Emmanuel Macron dedicated a plan in 2019, with the hope of seeing them flourish everywhere across the ‘Hexagon to make the country a player in disruptive innovation. Grenoble did not wait for the green light from the president to get started. In 2023, its young shoots have raised nearly 1.2 billion euros. Enough to make it the fourth deep tech hub in Europe, according to the Dutch firm Dealroom.
Start-ups created with all their might
A breakthrough that fuels the Grenoble myth. Even abroad, the success of the French Silicon Valley is intriguing. “We recently received a Taiwanese delegation, which sought to understand the links between the academic and industrial world,” illustrates, not a little proud, the deputy director of the Grenoble Alpes attractiveness agency, Nicolas Béroud. Because that is where part of the recipe lies: in the close relationships that education, research and businesses have maintained for decades.
Their concentration in the Peninsula has a lot to do with it. In this northern district of the city crisscrossed by the Drac and Isère rivers, buildings are springing up like mushrooms to accommodate a growing crowd. Every day, 10,000 of Grenoble’s 65,000 students meet there, as well as 15,000 employees from industry and research, supported by the CNRS and the essential CEA. With its four cutting-edge laboratories, the sprawling Atomic Energy Commission (CEA) has become the conductor of Grenoble’s partition. Arriving on the territory in the 1950s, the public research establishment has since worked to “fertilize the local industrial fabric”, summarizes Jean-Michel Goiran, deputy director in charge of development.
A mission, and two means to accomplish it: working with manufacturers and creating start-ups with all their might. In half a century, around a hundred gems have emerged from CEA-Leti alone, the laboratory dedicated to microelectronics. Few have gone out of business. CEA management indicates that the resulting companies have a survival rate of 80% after ten years of existence, when the national average is estimated at 60%. Perhaps because Grenoble start-ups benefit from quality infrastructure and easy access to vital equipment. The Minatec innovation campus notably offers clean rooms for rental, these rooms under a controlled atmosphere used in industry. “This equipment allows start-ups to make prototypes of their products without overinvesting, or risking falling into the arms of players who could monopolize their research,” defends Yves Samson, program manager at the CEA in Grenoble.
Record fundraising and networking
Like most young shoots in the region, those of the research institute have an additional advantage. They are all involved in strategic areas: electronics, energy and to a lesser extent health and quantum. “These sectors are in line with national and European priorities. This explains the increase in fundraising observed on site,” analyzes Florent Genoux, the innovation delegate of Bpifrance in the Alpine region. And this, despite the winter that French Tech is currently going through.
In Isère as in the rest of France, however, the amounts remain light years away from the rivers of cash that irrigate California’s Silicon Valley. Local start-ups also struggle to access funding as they grow. Which does not prevent some exploits. Last year, the young battery manufacturer Verkor achieved the feat of raising nearly 2 billion euros. A record fundraising in France, which should benefit the attractiveness of Grenoble.
Francesco Volpe, the CEO of Renaissance Fusion, embraced the city because of its proximity to his home country of Italy. But above all, the researcher set up shop there to benefit from long-standing expertise in magnetic fields and particle physics. Two key areas for bringing its nuclear fusion reactor project to fruition. “Not to mention that networking is in full swing in Grenoble, which makes it easy to develop there,” adds a member of his team. Although it has established its head office in Toulouse – “the place to be” for an aeronautics player – Limatech has for its part decided to return to Isère to build its first aircraft battery factory. “Our business is electromechanics. Recruitment is easier in the Grenoble area,” explains its strategy director, Aurélien Gibert.
War for talent
This quest for talent remains fierce, especially as the region moves towards full employment. In this ecosystem stuck at the foot of the mountains, everyone knows each other and transfers from one company to another are frequent. To grow quickly, Verkor drew a number of employees from the workforce of neighboring deep tech companies, in addition to those recruited from large groups like Valeo, Nissan and Thales. Its CEO Benoît Lemaignan is himself at the origin of another successful Grenoble start-up, Waga Energy, which recycles methane from landfills.
But the good fortune of this core of innovators hides disparities in access to employment in the metropolis. Rather egalitarian, it nevertheless concentrates significant pockets of precariousness. The city of Grenoble, in particular, is home to neighborhoods where the poverty rate is close to 50%. The Silicon Valley of the Alps is also suffering from growing tensions around the “grabbing” of water by industry. Semiconductor manufacturers love it: the STMicroelectronics site in Crolles alone consumes more than 4 million cubic meters each year. Pure and abundant, the water contributed greatly to the growth of Grenoble at the end of the 19th century, by promoting the deployment of hydroelectricity, the famous “white coal”. A liquid treasure of which the Grenoble industrial fabric will have to learn to make reasonable use to maintain its place in European innovation.
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