Welcome to Seed Scout which takes you inside France’s early-stage startup scene. As a reminder, this newsletter is free. Upgrade to a paid membership to get full access to all the articles.

It's been a busy few weeks for early-stage announcements:

Bpifrance: The state bank officially launched its 3rd national Seed Fund, aka, le Fonds National d'Amorçage. Seed Fund III is €400 million, for a total of €1.5 billion across all three funds.

Teampact Ventures: The New Kids On The Early-Stage Block announced a first closing of €20 million toward a goal of €50 million. The impact-driven Seed fund is led by Ex-Rugby Star Benjamin Kayser and Alan Co-Founder Jean-Charles Samuelian (who was also an early backer of Mistral AI). They will recruit the "greatest athletes on the planet" to invest in the fund and advise, er, coach, their portfolio.

Gaillon.exe: Almost 2 years ago, the global network of French entrepreneurs known as The Gaillon Project made the first closing of €30 million toward its planned €80 million Seed Fund. Co-founder Agathe Wautier revealed on LinkedIn that the firm is on the cusp of a final closing this week.

Now, on with the newsletter! In this week's edition:

• Seed Of The Week: Phospho co-founder and CEO, Paul Venard, tells us how their one-of-a-kind GenAI development platform guides devs through building and deploying LLM services, allowing them to navigate the evolving landscape of AI development and code with confidence.
• Investor Spotlight: Ex-financier and avid Business Angel Didier Valet, talks about the birthing of Varsity, a brand new early-stage VC fund he has just set up alongside VC Florent Thomas (ex-Serena) and founder turned VC, Kamel Zeroual (ex-Stribe).
• Hot Seed Deals: Adaptable ML, Moment, Avator Medical, Composable Prompts & More!

Chris O'Brien & Helen O'Reilly-Durand

The French Tech Journal

The frenzy around all things GenAI at the moment means that companies are getting thrust into the fundraising limelight almost at the very moment of conception. Phospho didn't quite raise its Pre-Seed round that early, but it wasn't far off.

Co-founder and CEO Paul-Louis Venard said in an interview that Phospho's goal is to help GenAI teams gain greater insight into how their applications are being used.

"We're addressing the problem that so many developers deploy to users and basically had no idea of what was happening, who their users were, how they were interacting with the product," Venard said. "So they were completely blindsided by what was happening. We decided to provide them with a tool to help them to understand what is working and what is not working."

Varsity is a new pan-European Seed fund based in Paris that just announced its first closing of €80 million toward a €150 million goal it expects to reach by the end of the year.

The Head Coach of Varsity is former Société Générale's Didier Valet who served as one of the bank's highest-ranking execs for almost two decades before leaving in 2018. Toward the end of that stint and over the past few years, Valet has become one of France's most prolific Business Angels. He wanted to scale up that investment work and expand beyond his base of fintech, so he created Varsity by teaming up with former Serena Capital partner Kamel Zeroual (who was also an Angel investor), and former Serena operations manager Florent Thomas.

"We saw that the combination of our skills as investors was making us relatively successful in winning some transactions," Valet said. "And on my side, I was ready to re-engage in an adventure that was a bit more for the long term."

What: Adaptive ML, a startup that wants to help companies more efficiently leverage insights gained from users of their GenAI to improve the models rapidly.

Why: To make the techniques and processes used by OpenAI to build ChatGPT available to enterprises and developers creating their own specific GenAI applications.

Funding: €20 million
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Who: Co-founders are Daniel Hesslow (Research Scientist), Axel Marmet (RL Wizard), Olivier Cruchant (Lead Technical Product Manager), Baptiste Pannier (CTO), Julien Launay (CEO), Alessandro Cappelli (Research Scientist).

‌Investors: Index Ventures led the round which also included money from ICONIQ Capital, Motier Ventures, Databricks Ventures, IRIS, and HuggingFund by Factoria. Money also came from Business Angels, including Xavier Niel, Olivier Pomel ( Datadog ), Dylan Patel (SemiAnalysis), Tri Dao (FlashAttention), and Arthur Querou (Vibe).

What's next: Adaptive's founders are Franco-American and officially based in New York City, but they will use the funding for a Paris R&D center and to hire at least a dozen employees.

What: Moment, a startup that designs, manufactures, and markets a range of on-board Wi-Fi equipment and streaming platforms for airplanes, trains, and boats.

Why: To enhance the passenger experience, increase crew performance, and boost onboard revenues.

Funding: €5 million
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Who: Co-founders Tanguy Morel and Michael Serres

‌Investors: Eiffel Investment Group

What's next: The new cash will allow Moment to accelerate its innovation programs, expand its presence in France, Southeast Asia, and the Middle East, and further develop its subsidiary, Moment Care, an entertainment platform for hospital patients.

What: Avatar Medical, an XR medtech that transforms medical images into patient-specific 3D "avatars."

Why: To increase access to 3D medical imaging to redefine surgical consultations, simplify operative planning, and enhance patient satisfaction while providing young doctors with a useful and innovative training tool.

Funding: €5 million
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Who: Co-founders Xavier Wartelle, Elodie Brient-Litzler, Mohamed El Beheir, Marie Buhot-Launay

Investors: GO Capital, Acorn Pacific Ventures, Plug and Play (US), Rives Croissance, Cenitz & 15 surgeons and radiologists

What's next: The new cash will allow the medtech to invest in its commercialization in the United States and Europe, and develop its product, AvatarCloud.

What: Composable Prompts, publisher of a GenAI platform facilitating the integration of LLMs into the work processes of major accounts, equipping them with governance, fine-grained security, collaboration and orchestration, and an innovative LLM virtualization engine.

Why: To remove friction and accelerate the nascent adoption of Large Language Models (LLMs) within the enterprise sector.

Funding: €3.7 million
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Who: Founder Eric Barroca

‌Investors: Elaia, Illuminate Financial, Motier Ventures, Kima Ventures, m-ai club, Super Capital & several business angels.

What's next: The new cash will be used to launch the platform and accelerate its development.

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