Invest in Grenoble-Isère: Mountains and microchips - Véronique Péquignat

New ideas are always welcome in Grenoble-Isère, the beating economic heart of France's Auvergne-Rhône-Alpes region. Véronique Péquignat, director of international actions and key technologies at Invest in Grenoble-Isère, explains why this small city attracts so much international investment and brainpower.

Grenoble, at the foot of the French Alps, is probably best known as the host of the 1968 Winter Olympics. The slopes looming over the city are still a winter playground for residents and seasonal waves of tourists but down below, in labs and industrial parks, some of the world's sharpest scientific minds develop and research our future.

Industries at the forefront of technological innovation began making the switch to Grenoble-Isère in the 1950s - starting with Becton Dickinson and quickly followed by major players including Xerox, Sun Microsystems and HP. Today, the city is a hotspot for IT and digital technology, renewable energy and healthcare technology. A business-friendly local government and close ties to Université Grenoble Alpes have produced an environment that fosters innovation, with the result that Grenoble has been named the world's fifth-most-inventive city, and France's second-largest leader for research and development. The 'capital of the Alps' has become a heartland of innovation: a European Silicon Valley.

Got your back

Invest in Grenoble-Isère (AEPI), a council-backed economic development agency for the region, provides information, contacts and local resources to potential stakeholders. Véronique Péquignat, the AEPI's director of international actions and key technologies, explains that its challenge is to know the local market intimately, while making sure to have a wide reach across industrial sectors and international borders.

"Our key differentiation factor with regard to what other agencies might do is that, first of all, we have people working for us abroad," she explains. "We have one full-time person in the US; we work with consultants in the UK and Germany; we have offices in Taiwan and Korea; and we are completely connected to the Business France offices all around the world.

"The second factor is that we have dedicated experts, not only in the foreign markets but also in the sectors, which means we know our industry sectors from local to global. So I have one person dedicated to medical technology, one person dedicated to IT, another one to clean technology, another to energy and energy storage, and so on."

AEPI experts work with existing industrial research centres in Grenoble-Isère to identify research projects and sectors that could benefit from new investment in the region, and tap businesses with potential to fill the gap. It approaches prospective partners around the world to gauge their interest in moving their operations. AEPI then functions as a 'one-stop shop' for existing investors and foreign CFOs looking to make the move.

"We're here at every step," Péquignat says. "Helping [an investor] get to know the right contacts at the right time - so that means a good understanding of the global markets, the local industry and stakeholders. And then introducing them to the ecosystem: helping them with the legal aspects of setting up an operation in our region, helping them with recruiting and accessing services, and making sure that the company is well connected and gets a full experience of what it is like here."

A matter of trust

Those who make the switch find themselves living and working in a futuristic, eco-friendly brain trust. Grenoble was the first major French city to elect a 'green' mayor, so sustainability, with an ultramodern flavour, is big. Trams have been reintroduced, speed limits reduced for inner urban areas, and Toyota is experimenting with an electric car-sharing system of the kind rarely seen outside Japan. Having been one of the pioneers of hydropower in the 19th century, the city still serves as a testing ground for renewable energy and urban sustainability technology.

The influx of international companies has brought a diverse population of just under 665,000, all with a singular purpose that has created a spirit of collaboration between research centres, industry and the university. "It's a real ecosystem: this interaction is a reality, rather than top-down initiated. It's in the DNA," says Péquignat.

CFOs looking at establishing a base of operations in France tend to look to Paris as a matter of course, but they often find that the best and brightest in their field are more easily found in a place like Grenoble. Grenoble Alpes University has a history of working closely with local industry: the chairman of the first technical university, Paul-Louis Merlin, co-founded the company that later became Schneider Electric. Today, three Grenoble institutions cover medical science, engineering and humanities, and one in five inhabitants is a student. The result of a strong alumni network and support for research from the local government has been a proliferation of research jobs, attracting PhDs and post-doctoral students.

"One of our success stories came because they knew they could easily recruit locally and attract the best talents in their domain," says Péquignat. "Also, you do have a specific entrepreneurial spirit: for a long time, there's been a tradition of creating start-ups and innovation in all kinds of fields. It's really the risk-taking spirit; it's not something you find in many places in France, and this is a place where you do find it."

Clean, green and friendly

Grenoble can be a welcome change from life in a major city. "It's small, first of all, so it's easier to meet people; it's very tightly knit. It's going to be cheaper than Paris, that's for sure," she adds. "And of course, within 30 minutes you can get up in the mountains and go skiing."

The US is the biggest source of investment in Grenoble, responsible for one of the most recent arrivals. Hexcel Composites made the decision 18 months ago to build an industrial site in the Rhone valley to manufacture carbon nanofibres - conveniently located for the booming French avionics sector. Germany is the second-largest investor and the UK third. With the effects of the Brexit decision still reverberating, Péquignat confirms that she sees changes on the horizon.

"Nobody actually knows what the consequences are going to be, it just brings a lot of uncertainty, but I can think of at least two or three examples of bigger companies that decided to hurry up their projects. It was a tipping point for them to make a decision to invest in France," she says. "Some of the SMEs and start-ups are also considering relocating here in France or at least in Europe - being small companies, it's going to be very difficult for them to handle all the complications that are going to come with Brexit."

In the face of that uncertainty, it's important to stick together. "We have formed a meta-cluster with all the major electronics clusters in Europe called the Silicon Europe Alliance. We are much stronger in facing competition when we work together - but I know that our colleagues from the UK are really worried about what impact Brexit is going to have on European collaboration programmes such as this one."

Grenoble-Isère is home to a third of France's employment in the electronics components sector, including Semtech, of which the LoRa wireless technology - essential to the growth of the internet of things - was first trialled in Grenoble. "This is one of the few places where you can think in terms of hardware and software together," says Péquignat.

Investment from Asia

This reputation as a haven for digital innovation has resulted in an uptick in interest from Asian investors, helped along by the AEPI offices in Taiwan and Korea.

"When we're talking about the digital world, there's no way around the fact that lots of things are happening in Asia, and that means quite a few of the Asian countries are putting a lot of effort into investment into these sectors," says Péquignat.

However, having spent time in the region to leverage the heightened interest in Grenoble, she's learned it's important to be specific.

"Asia is very diverse. The more you know about Asia, the more you are careful to talk specifically about the Taiwanese market or Korea, or China or Japan. They have completely different businesses and business outlooks, so we have to be very careful about not putting, as we say in France, everybody in the same bag."

The AEPI regularly holds programmes and events to leverage its network to connect investors, researchers and entrepreneurs, in Grenoble and abroad - with plans for events in Singapore and Taipei, as well as the UK and US. "You always find a company or somebody who's got some connection with Grenoble," says Péquignat.

The process of economic development takes years of investment and constant interaction between all the players in a sector, but Péquignat thinks of it as an exercise in building relationships. "A lot of it is personal; keeping the right contacts and knowing your people. That's why we recently launched the 'Ambassadeurs Alpes-Isère', as any actor can be an ambassador and promote our region to others," she says. "We're very patient but, at the same time, also very reactive when the company is ready to move."

This is a place where software meets hardware and local meets global. Scientific curiosity has brought people and companies from all over the world to collaborate in this small French city: a unique ecosystem that's open for business.

Véronique Péquignat, director of international actions and key technologies at Invest in Grenoble-Isère.