TIME EUROPE
June 12, 2000 VOL. 155 NO. 23
French Exodus
Driven out by excessive taxes and red tape, and also by a spirit of adventure, more and more French men and women are taking their talents abroad
By BRUCE CRUMLEY Paris
Such has been the quality of life in france that the French have typically preferred to stay home rather than venture abroad in search of fame or fortune. But that's changing fast. Thanks to frustrations at home and attractions abroad that range from fewer taxes to more professional opportunities, record numbers of French researchers, doctors, managers and business owners are heading for the exits.
An estimated 2 million French citizens now live and work in foreign countries, most mobilized by the lowering of borders within the E.U. that allows residents to relocate homes and businesses in whatever E.U. nation — or market — they deem most attractive and advantageous. While that mobility has not led to major defections of large French companies to nations with lighter taxation, France's notoriously high taxes — a panoply of charges that in 1998 represented 62% of average individual income, versus 40% in Britain, and an E.U. average of 48.9% — employee social charges and labor market rigidities have provoked a considerable flight of small and medium-sized business, primarily to Britain. A special surtax on the highest incomes, meanwhile, has provoked an exodus of the wealthy.
In addition to tax refugees, large numbers of dynamic and ambitious young French people have jumped ship in frustration over the rigid mentalities and practices that dominate most French companies, with their stress on diplomas and connections and their tendency to hand out promotions based on time served rather than merit. The quick reaction time required by the New Economy and its start-up offspring has begun to speed up the creaking gears of France's business establishment — but not quickly enough to halt the flight of young people abroad, where more money and stock options stand to be made and kept. Some estimates put the number of French citizens in Silicon Valley alone at over 50,000. "They gave up hope of changing France, so they came here to change the world," explains Frenchman Jacques Gauchey, founder of G.a Communications in Mill Valley, Calif., which advises American Internet start-up firms looking to expand to Europe.
Herewith, a Time gallery of some of the adventurous men and women who have taken their talents abroad and given a broader range to the inimitable French style.
Silicon Valley Dreamers
Retailing It to Hong Kong
Success Begins at Home
Putting the Icing on London
Silicon Valley Dreamers
The thing that ultimately provoked software entrepreneurs Virginie and Eric Glaenzer to leave home for an entirely unknown future abroad was what Virginie now calls "that miserable French business attitude." Armed in 1997 with a software project to create an easily negotiable graphic interface for novice PC users, they ran into a wall of rejection and outright scorn from would-be banking and corporate partners — and even their own pals.
"Banks and companies would tell us we were too young, too ambitious, and not realistic enough to merit their confidence — to come back once we'd become successful," Virginie recalls. "The worst, though, was the reaction of our friends' who'd say, 'What do you want to take all that risk and responsibility for anyway?'" Undaunted, the Glaenzers sold off everything they had, and in November 1998 left France for the promise of Silicon Valley. Subsisting on Eric's consulting income, the couple shopped around a new software concept: a desktop overlay using their invention, called Dot-Gui, to simulate preferred Internet portal pages like Yahoo, and allow considerably enhanced, server-generated interactivity like e-mail notification, stock and news updates. By July 1999, the Glaenzers had secured sufficient financing to quit all other work and start pulling long hours in the garage of their Redwood City home. By last December, the modestly paid, six-person team that made up the couple's Inventop Software Corp. had their Desktop Blaster program ready for marketing. At roughly the same time, the Glaenzers decided to celebrate the birth of their first daughter by founding a start-up incubator company, 2partners.com.
Their Silicon dream, however, has yet to fully blossom. Eric, 32, has returned to consulting while Virginie, 29, continues marketing Desktop Blaster to potential buyers.
"If we don't find anyone, that's okay — we've got other projects lined up," Virginie stresses. "This helped us learn how to put a project and team together, raise funding, run a business — and also learn a lot about ourselves. In France, this venture would be viewed as a failure. Here it's seen as a start or first try — a good experience to build on."
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Retailing It to Hong Kong
Valerie Ohanessian was 18 when she decided to shun a university education for a job typing invoices at the electrical product company where her father worked in Grenoble. Five years later, having moved up to the export department, she was sent on a business trip to Hong Kong. To her amazement, her client there offered her a marketing job that paid $5,000 a month. "It was five times more than I was earning in France," recalls the 35-year-old. "So I moved to Hong Kong, and I won't ever go back."
Even though she was laid off more than a year later, Ohanessian didn't consider returning home. "In France, if you don't have the right degree, your options are limited," she says. Using contacts from her previous job and $50,000 saved from her salary and successful plays on the stock market, she started her own electrical products firm called Charter Queen in 1989. She worked 90-hour weeks, forgoing vacations for four years — the time it took for her company to turn a profit. In 1997, along with two partners, she took control of an interior design firm that a fellow French expatriate had tired of. With both businesses running solidly in the black, she accepted a friend's suggestion to sell diet products imported from France and last February launched her third business — despite the fact that she knew little about retailing.
Ohanessian has no regrets about leaving France. In Hong Kong, she pays only a 15% tax on her salary, 16% on her company profits, works 90 hours a week and drives a Jaguar.
Had she stayed in France, with its mandatory 35-hour workweek and confiscatory tax levels, she believes her life would bear little resemblance to the one she leads now. "I wouldn't be able to work the hours that I do and, after taxes, I'd be left with nothing," she says.
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Success Begins at Home
While many of her compatriots have gone abroad to seek opportunities they can't find at home, French attorney Christine Lagarde used a sterling career in France as a springboard to international success. Born in Normandy and educated in Paris,
Lagarde last October celebrated her 18th anniversary with the Paris office of international law firm Baker & McKenzie by winning the top job of the Chicago-based company's global operations. In an industry still dominated by aging, white, American males, the ascension of the 44-year-old Lagarde as chairman of the world's second-largest law firm was revolutionary, putting her in charge of a 35-nation legal empire generating revenues of $818 million.
Lagarde's career is proof that, for talented French men and women, international success is not necessarily synonymous with getting out. After joining Baker & McKenzie's Paris firm as an antitrust and labor law specialist in 1981, she became a partner in just six years.
Lagarde's performance led to her appointment to the firm's central executive committee in 1995, followed two years later by her selection to head its European operations. Today, while still nominally Paris-based, Lagarde spends most of her time meeting with clients and managers of the firm's 60 offices around the world, and consulting colleagues in Chicago. Her remaining time is spent in France, divided between work and family life with her husband and two sons.
Though hardly a disgruntled exile, Lagarde does believe that France could do better at offering opportunities to wo-men as well as "embracing globalization and rising to challenges and competition."
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Putting the Icing on London
The English and the French have spent centuries hating — and fighting — each other, but don't expect any Brit-bashing from Eric Lanlard. The self-confessed Anglophile, who adores the English countryside, traditional Christmases and the Royal Family, has also found that Britain offered him all the right ingredients for success as a pastry chef and entrepreneur.
Lanlard arrived in London in 1989 after a two-year apprenticeship and a national service stint aboard the French Navy flagship, the Jeanne d'Arc, where he once cooked for President François Mitterrand. In London, he soon landed a job as a pâtissier with the French restaurateurs Roux Brothers. Two years later Lanlard was in charge of their whole pastry operation and its 14 staffers — something, he says, that "would never have happened in France." Back home, he would have had to have gray hair to reach the same level of responsibility. Says Lanlard: "If you are doing a good job here, your age or your diplomas don't matter."
After six years with the Roux Brothers, Lanlard launched his own company, Laboratoire 2000, and never looked back. At first, he was happy to deliver two cakes a day. Now, a staff of 12 create some $24,000-worth of pastries each week for such illustrious London stores as Harvey Nichols and Fortnum & Mason. Last January, he started a spin-off company called Savoir Design, which specializes in custom-made cakes that sell for as much as $1,000 apiece. The company's weekly output now averages 10 cakes, but he is confident that the business will skyrocket once the word spreads.
Though he is a product of French training, Lanlard, 32, claims to miss nothing about his native country. "I refuse to work in Paris, I can't stand the people," he says. "Members of my own family live there and they are rude." True, Brits tend to value quantity over quality when it comes to food, he says, but "if I miss French food I can cross the road and go to any number of good French restaurants."
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June 12, 2000
SPECIAL REPORT
French Connected
Despite a legacy of state control, and an archaic political leadership, France is thriving — and modernizing — in the face of global competition
Venture Playground
A new spirit of entrepreneurship has created a thriving culture for Internet start-ups and fueled the country's robust growth. How the new economy is changing the way the French do business — and reshaping the nation itself
French Exodus
Driven out by excessive taxes and red tape, and also by a spirit of adventure, more and more French men and women are taking their talents abroad
Mixing Bowl
The French don't like to admit it, but decades of immigration have produced a multicultural society that is reinvigorating the nation
Vive Les Regions
Key provincial cities are emerging as the new vectors of economic development and cultural expression
From Decline to Renewal
Stanley Hoffman on France's success as a modern, middle-size power
EUROPE
The Victory Lap?
Europe toasts Clinton one more time, but the Atlantic relationship is showing strain
Soft Power Politics
Europe and the U.S. must seek a world beyond winners and losers
Battle of the Basques
Political inertia combines with disunity and distrust among Spain's national and regional security forces to play into the hands of the terrorist group ETA
Expensive Exposure
Hanover hopes Expo 2000 will put it on the map. It surely will, but the price of publicity will be high
Lights, Camera, Shoot!
Police disguised as a TV crew trick a man to free children and teachers held hostage in Luxembourg
AFRICA
Reliving Apartheid Horrors
The trial of a South African cardiologist accused of murder reopens old wounds
BUSINESS
Ad Land Goes Cyber
Virtual agencies are using the Web to create campaigns in record time, and without the bureaucracy
The Game of the Name
The struggle for Web dominance shows that brands matter just as much in the new economy as in the old
The Wide Blue Yonder
Giant airships could become commercially viable again six decades after the Hindenburg disaster
Battle Below the Belt
Designer Calvin Klein goes to court claiming a business partner is destroying his brand's image
SOCIETY
Tangled Webs for Sale
Planning a tryst or a day at the races away from the boss? A Scottish firm can cover your tracks — for a fee
THE ARTS
Recreating a Jewel
Egypt has built an updated version of the fabled Bibliotheca Alexandrina, but its commitment to intellectual freedom remains an open question
Thandie Makes It Possible
Her mission: to help make M:I-2 the hottest movie of the season. But first she tells you about Hollywood stupidity (and Tom's unusual sense of humor)
The Daily Courage
Journalist Benjamin Pogrund let the facts speak for themselves, no easy task in apartheid South Africa
DEPARTMENTS
Essay
To Our Readers
World Watch
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