Bankruptcies in France’s tech startup sector are rising, according to a survey by industry research group ScaleX Invest.

These findings indicate financial struggles within the sector, which may complicate the efforts to position Paris as a leading European tech hub.

ScaleX Invest reported that 10.4% of 1,487 analyzed French tech startups are at high risk of bankruptcy.

The report also highlighted that the number of bankruptcies and insolvency proceedings has exceeded the total number of new series A funding rounds.

Key factors impacting the industry include tightening funding conditions and declining valuations.