Enterprises created in 2002 by non-EU nationals in France: finding it harder to survive

Abstract

This chapter analyses the reasons for the success/failure of enterprises owned by third-country nationals in France. The analysis is based on longitudinal data from the Information System on new Enterprises (SINE). Foreign nationals are more likely than the French to set up their own firms, but those firms are far more vulnerable. Only 40% of migrant (non-EU) businesses created in 2002 were still in existence after five years, compared with 54% of corresponding native businesses. The first and third years are particularly difficult hurdles to overcome. However, rates seem to vary according to a number of business characteristics. The third-country nationals owned enterprises that are most successful and aligned with French enterprises in terms of survival rates are commercial businesses and firms with a large, local client base. Conversely, construction businesses and individual firms are more vulnerable to failure than French firms in the same category. Among the others, the greatest factor in entrepreneurial success appears to be start-up capital investment.