EMMANUEL MACRON’s ambition of turning France into a “startup nation” got a much-needed shot in the arm this week as investors pledged to plow about €109 billion ($114 billion) into artificial intelligence (AI) projects in the country. For the French President, the investments are critical to safeguarding his legacy — one that’s made entrepreneurship cool in France.

For years, among the highest aspirations of the country’s young graduates was to be a civil servant — a “fonctionnaire,” as the French call them — or climb the corporate ladder at big conglomerates. Not anymore. Changes in the attitude to work among young people, Mr. Macron’s push and the emergence of the gig economy have made being an entrepreneur the preferred option for many, and that needs funding.

France’s startup scene saw the most dramatic growth of any European country over the last decade, with investments jumping nearly 1000% to $60 billion, according to London-based venture capital firm Atomico. But money started to peter out in the last two years amid political turmoil and shrinking valuations. Mr. Macron has been keen to rekindle investor interest to preserve one of the bright spots of his reign and make the country’s entrepreneurial culture stick.

The Artificial Intelligence Action summit in Paris this week was part of that effort. It drew investment pledges from the United Arab Emirates, Amazon.com, Inc., Brookfield Asset Management, Apollo Global Management, Inc. and others, suggesting the country’s work-shift trends will continue to be bankrolled.

Investors have taken note of the change in the country’s entrepreneurial mindset, says Nina Rawal, partner and co-head of ventures at Trill Impact, a Stockholm-based fund that invested in French startup May Health last year alongside state-owned Bpifrance and Paris-based Sofinnova Partners.

“You can feel the difference. I don’t know about efficiency, or value for money, but in terms of feeling a different energy in Paris, it’s very clear,” said Ms. Rawal, who, with a background in neuroscience, spent some time as a student in France. Silicon Valley’s powerful narrative has infiltrated French culture, she said.

Although the emergence of China’s DeepSeek has shaken France’s AI scene, rising stars like Mistral, H and Poolside have drawn investors, funds and credibility. Other startups like online insurer Alan, now valued at €4 billion, Doctolib, an app for medical appointments valued at €5.8 billion, and second-hand smartphone seller Backmarket worth €5.1 billion have shown what’s possible.

“This has come with quite a big change in mindset and culture,” Clara Chappaz, a 35-year-old Harvard Business School graduate and France’s first minister for Artificial Intelligence and Digitalization, said in an interview. “There’s been a big piece of work done on changing the culture of work — giving the idea and the belief to everyone that they can start their own companies, they can create new things, they can innovate.”

As old taboos around creating wealth, making money, running a company and even failing have faded away, more young people in France are choosing to start businesses. Some 58% of French citizens under 30 are involved in entrepreneurship, according to a 2023 study by French state investment bank Bpifrance. That’s up from 36% in 2016.

Responses in a survey from about 2,099 graduates of France’s most notable and prestigious universities and colleges showed more of them were motivated by having an “entrepreneurial profile” than on developing a route to reach the upper echelons of management — something their parents had strived for.

The French perception of chief executive officers is no longer one of someone “just exploiting poor workers,” said Axel Cateland, founder of fintech startup Kulipa. Now, “everybody knows someone who works for a startup, especially if you live in Paris,” he said. “It’s changed the perception.”

Pressure has also mounted on young graduates to chart their own course as other avenues of employment have narrowed. With a huge debt load and mounting budget deficits, France is slimming the ranks of its civil servants. Also, with higher life expectancy, employees at the country’s biggest companies are hanging on to their jobs for longer, shrinking the number of new openings.

From her office at Station F, one of the world’s largest startup incubators, Roxanne Varza has a front-row seat to the unfolding economic transformation in France. Founded by French billionaire Xavier Niel and opened in 2017 by Mr. Macron soon after he took office, Station F is a startup accelerator that’s housed in an old reconverted railway station in eastern Paris and is headed by Ms. Varza, who grew up in Silicon Valley. 

When Ms. Varza arrived in France 15 years ago, entrepreneurship was “not cool at all,” she said. If someone told their family they wanted to start a company, their parents would say, “but you’ve done all this studying — why don’t you get a ‘real’ job?” Ms. Varza said. “Then all of a sudden it became really trendy for everyone to have their own company and to start a startup.”

Ms. Varza credits Mr. Macron’s pro-business policies for helping fuel the shift. During the president’s first term, moves like the flat 30% tax on capital gains and exemption of investments in companies from wealth tax helped bring in funds. Accelerators like Station F also made the choice more credible and reduced some of the risk, she said.

“Today risk is almost celebrated, whereas in the past it was really kind of like, ‘Why would you make that kind of decision?’” she said.

People are also viewing failure differently. “Failure was really considered a dead end,” Kulipa’s Mr. Cateland said. But entrepreneurs have presented it as a chance to do better the second time around, and that “changed perceptions,” he said.

Other countries in Europe are similarly seeking to transition from older economic models — there are tech hubs in London, Berlin, Dublin and Amsterdam. That said, the region is struggling to boost venture capital funding for AI startups, which is dwarfed by money pouring into similar US companies — about $15 billion in Europe and Israel put together last year compared with almost $100 billion in the US.

But France has a leg up on its neighbors, particularly with its lower electricity prices — thanks to nuclear energy — and its technical prowess. The country has the second-highest number of Fields Medals, the most prestigious award for mathematics, behind the US. After decades of trying and failing to leverage its engineering and technology skills, a new generation of business founders in France has finally found a Silicon Valley-style momentum building.

“Companies like Mistral can now be in an article alongside global leaders like OpenAI, and nobody questions it,” Ms. Varza said.

American TV shows and movies like Silicon Valley, The Social Network and The Internship have made a deep impression, Mr. Cateland said. Employees find the more casual dress and atmosphere at startups appealing, although “we don’t all look like Mark,” he said, alluding to Meta Platforms, Inc.’s founder.

While the last decade saw tremendous growth, France’s startup ecosystem may encounter more headwinds in the next decade as the struggle to balance the budget constrains the government’s  ability to back fledgling companies. But Ms. Chappaz, who previously served as the chief executive officer of the French Tech Mission, a government agency tasked with beefing up the country’s startup roster, said she remains committed.

“It’s very important for this government to continue supporting the ecosystem,” she said. “There’s still so much potential.” — Bloomberg News