What Norway Can Learn From Northern France

The en vogue discussion topic in Norway these days is "what happens when the oil runs out?" Technoport travelled to Lille to find out how they turned to digital entrepreneurship to help solve the region's economic troubles.
Lille France

Lille was once the factory of France. As early as the 16th Century, the textile industry domainted the regional economy, helped in part by the area's proximity to Britain. Lille became an industrial powerhouse and produced much of the textiles and lace used throughout the country, and beyond. But just like the mills of northern England, Lille's main industry suffered as the 20th Century progressed due to competition from cheaper imports. This coincided with the decline of the mining industry, leaving the region facing a serious problem.

In 1968, almost 52,000 people were employed in industrial and/or engineering work in the Lille region. By 2006, that figure had dropped to less than 14,000. In the same time period, unemployment rose from under 3% to over 15%.

Nord France Invest is the economic development agency for Lille Region, serving all of Northern France. They identify international projects that offer a good fit with the region, then provide advice and support at every stage to integrate investors and their businesses into the local economy.

Together with a myriad of actors including the Chamber of Commerce and local, regional, national and European governments, the brains behind the Lille Region have slowly but surely worked on a solution around innovation.

1. Innovate, but don't reinvent the wheel

Although I was there to investigate digital innovation, I am impressed by how the region has stayed true to its roots. In addition to renovating former textile factories into digital innovation hubs, the region has managed to benefit from its strong heritage in textiles.

There's no possibility for Lille to compete on price with textile factories in Eastern Europe, China, the Indian subcontinent or South-East Asia. However, they are ploughing money into R&D to develop the fibres of tomorrow. There are now more than 300 technical textiles companies - the highest concentration in all of Europe - within 150 kilometers of Lille.

Facilities include CETI - European Centre for Innovative Texiles, GEMTEX - a laboratory for textile engineering and materials, HEI - an industrial engineering school, and IFTH - the French institute for textiles and clothing.

Learning Point

Norway's strengths are in energy, engineering, world-leading research and problem-solving. Let's focus on what we do best.

2. A digital future is a safe bet, but niching down is wise

The strength of the Lille region is its proximity to Paris, London and Brussels, three of Europe's key capitals are less than 90 minutes away by train. But this is also a problem when it comes to investing in digital technologies. Lille is never going to be able to compete with its neighbours on a general level, so finding a niche within digital technology is a wise move.

In a suburb of Lille, a former complex of textile factories are being renovated into what will essentially be an entire new town based on digital media. The anchor tenant of the Plaine Images digital media cluster is Ankama, the games company responsible for the online role-playing game Dofus, but of more interest to me was the building opposite, the Imaginarium. The 8,000 square-metre building includes a substantial collaborative working space, a startup incubator, a business accelerator, research equipment and a groundfloor "showroom" where current projects are displayed for all visitors to browse.

Plaine Images Lille

The focus on the digital media niche continues elsewhere in the region. An hour's drive away in Valenciennes is Serre Numérique (the Digital Greenhouse), a new campus bringing together small businesses, entrepreneurs, and three schools under the Rubika brand focusing on industrial design, animation and video games.

Exciting things are going to happen here.

La Serre Numérique

Learning Point

Rather than just Norwegian language versions of successful startups from elsewhere in the world, I'd love to see Norwegian entrepreneurs develop more digital solutions that build on the country's industrial strengths, just like Xeneta has done.

Should Innovation Norway be spending money on a Plaine Image style campus for digital engineering?

3. Financial incentives work

As in Norway, it's expensive to employ people in France. Scaling up from a founding team of two or three people is a dangerous time for every startup. At Plaine Images, startups can enjoy a period of up to four years free of employment taxes. Not only does this decrease the chances of a startup with a fantastic product or service failing due to cash flow, it actively encourages the creation of new jobs.

Learning Point

Employing staff in Norway is very expensive. It's the primary reason I've chosen to remain freelance rather than expand into an agency. Is there scope for selected startups (most likely through incubators) to recieve a discount on employment taxes? There are already tax advantages of doing business in Finnmark, for example, but tax benefits for startups have to be focused on employment, not profits.

Next Steps for Lille, and for Norway

Lille might not be the factory of France anymore, but by implementing a clear innovation strategy in specific areas, it can become the "digital factory" of France. The question for Norway is, how should the country position itself within the Nordic region, and how can Innovation Norway support that positioning?

Photo credit: LaurPhil

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