Let’s look beyond GAFA!
Amazon, Google, Facebook, Apple, Airbnb, Uber, or Netflix: GAFA, and more broadly speaking the Silicon Valley heavyweights, allow us to dream. The common link between these companies is that they are game-changers, disrupting entire sectors of the economy. Nonetheless, this still poses many questions, in particular concerning taxation, social law and changes in competition rights.
Europe also covets a place in the big league, and Europeans are coming up with more and more initiatives to promote their “champions”, just as Frenchtech or BPI do in France, for example. And yet, despite all these efforts, no European alternatives seems to be able to compete with the American titans. The particularities of the “old continent” — a plethora of countries, languages, and multiple and increasing regulations. — hinder the emergence of any European giants. On the other hand, India and China offer a unified domestic market to their entrepreneurs, thus facilitating their access to an international market.
Obsessed with GAFA, Europe is in danger of completely missing out on the emergence of the giants of tomorrow, who will no longer be American, but Chinese. If we take Tencent and Alibaba for example, we can see that they will be the ones to shake up the global market. They emerged and developed within a domestic market, where they now benefit from the goodwill of the State and suffer either no competition – or very little. This ensures comfortable growth as the population’s standard of living rises. Their much-coveted position allows them to constantly invest in new sectors and new markets- much more so than Amazon and Google. Alibaba, an e-commerce platform, has thus extended its activities to payment solutions, travel and insurance and invested in office space in Paris in 2016. While a French office was intended to support French brands with marketing their products in China, over time, it has evolved into other activities. Alibaba now works with French brands such as Axa, with whom it has developed a partnership to support Chinese tourists during their travels, or Edel (the E. Leclerc Group bank), developing the Alipay solution in France.
Chinese tourists were the first ambassadors of the Alibaba and Wechat services, allowing the companies to strategically position themselves outside of China. Those in the tourism sector, from hoteliers to shopkeepers, are gradually getting ready to meet the needs of Chinese tourists, visitor numbers are predicted to rise to 5 million visiting France alone in 2020! As such, they can offer the Chinese giants an initial foothold into the French market on a silver platter; they will then be able to capitalise on this opportunity and reach a wider audience when the time comes. These Neo-GAFA companies are coming soon and are unlikely to be European!