In summary…
The Innovation Investment Fund (FCPI) finances innovative SMEs—biotech, deeptech, digital—and entitles investors to an income tax reduction of 18% of the investment, capped at €12,000 (single investor) or €24,000 (couple). The performance potential is higher than that of a Local Investment Fund (FIP), but so is the risk: significant dispersion of results, where a few successes must offset several failures. A high-conviction investment, to be carefully considered.
- Reduction of 18 % of the payment, capped at €12,000 / €24,000
- Target innovation: High potential, but high dispersion and high risk
- Capital gains exempt from income tax upon exit (social security contributions of 17.2 % due)
Simulate your FCPI reduction
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FCPI Simulator
Finance innovative SMEs and reduce your tax by 18% through an Innovation Investment Fund.
Results are provided for illustrative and educational purposes only, based on the parameters entered and simplified assumptions (2026 tax year, constant return, excluding inflation). They do not constitute personalized investment advice, tax advice, or an offer to subscribe. Some investments carry a risk of capital loss. Before making any decision, consult an advisor.
Why FCPI is the most aggressive bet for tax optimization
The FCPI shares the tax mechanics of the FIP—18% tax reduction, same investment ceilings, same minimum 5-year lock-in period—but it differs in its target market: innovative SMEs. Biotech, disruptive technologies, digital technology, energy transition: companies with strong growth potential, but also a high probability of individual failure. It is a regulated venture capital investment, accessible with a tax advantage.
This nature completely changes the return profile. Whereas a regional FIP aims for gradual value creation, a FCPI relies on diversification: in a portfolio of innovative SMEs, several will disappoint, a few will fail, and ideally one or two spectacular successes will drive overall performance. This is the very logic of innovation financing.
The asset management benefit therefore lies in measured exposure to a diversified and aggressive asset class, where the entry risk is mitigated by the 18% reduction. However, this reduction does not protect against portfolio underperformance: the FCPI is a high-conviction investment, best reserved for the most dynamic—and most expendable—portion of your savings.
The 3 truths of the FCPI
Greater potential, paid for by greater risk
The FCPI (French Innovation Investment Fund) offers a more pronounced risk/return profile than the FIP (French Local Investment Fund): the potential for profit is real for successful innovations, but the probability of individual investment failure is high. The 18% discount softens the initial investment; it in no way guarantees a positive outcome. With this type of investment, one must accept a wide dispersion of results, ranging from very good to frankly disappointing.
Long-term illiquidity and capital not guaranteed
Like all unlisted funds, FCPIs lock in shares for at least 5 years, with real liquidity often occurring after 6-10 years, depending on sales. Capital is not guaranteed, and the exit value may be lower than the initial investment, even after a discount. This investment is only suitable for capital you don't need and for which you accept volatility, or even partial loss.
The choice of manager makes all the difference
In venture capital more than anywhere else, the gap between managers is immense: their ability to source the right deals, to support them, and to sell at the right time. Two FCPIs (French venture capital funds) offering the same tax reduction can deliver contrasting results. The team's track record, its specialization, and the level of fees take precedence over the tax rate alone. And this advantage is counted towards the overall tax-advantaged investment cap of €10,000 per year.
Case study: Thomas, 41, manager of a SaaS start-up in Bordeaux
Thomas, taxed at 45% (%), understands the risk of venture capital and wants to invest a portion of his savings aggressively while reducing his tax burden. He invests €12,000 in a FCPI (French venture capital fund). Here's what the simulator calculates, including diversification:
| Indicator | Amount | Comment |
|---|---|---|
| Payment | ≈ €12,000 | under the ceiling, single person |
| Tax reduction (18 %) | ≈ €2,160 | from the year of subscription |
| Net cost price | ≈ €9,840 | after reduction |
| Possible exit range | 0 to > €12,000 | high dispersion, unguaranteed capital |
The €2,160 reduction brings Thomas's cost basis down to approximately €9,840. In a favorable scenario, the portfolio's successes could push the exit value above the initial investment, resulting in a capital gain exempt from income tax. In an unfavorable scenario, the exit value could be less than the initial investment, or even zero for some holdings.
This diversification must be accepted knowingly. Thomas, who himself runs a technology company, understands the logic and limits this investment to the most aggressive portion of his savings. FCPI funds are never a core portfolio investment.
The FCPI's success hinges on the manager, not the reduction.
This simulator calculates the tax reduction of 18 %. In venture capital investments, performance depends primarily on the quality of the management team and its ability to select and support SMEs. Choosing a FCPI (French venture capital fund) solely for its tax advantages, without considering the manager and fees, exposes you to disappointment that the tax reduction will not compensate for.
Balmont Conseil is an objective wealth management firm, a member of ANACOFI, with no capital ties to any asset management company. We select FCPIs based on the manager's track record and specialization, and allocate them appropriately within a controlled portfolio. Let's make an appointment to position this lever within your overall strategy.
Frequently Asked Questions
What is the difference between a FCPI and a FIP?
Both share the same tax mechanics (18% tax reduction, same ceilings, minimum 5-year lock-in period), but differ in their underlying assets. The FIP finances diversified regional SMEs; the FCPI specifically targets innovative SMEs (biotech, deeptech, digital). The FCPI offers higher performance potential, at the cost of greater risk and dispersion of returns.
Is an FCPI riskier than a FIP?
Generally, yes. Innovation funding relies on significant diversification: many investments will disappoint, some will fail, and performance depends on a few successes. The 18% reduction in the % tax rate softens the initial investment but does not protect the capital. FCPIs are a high-conviction investment, best reserved for the most aggressive and non-essential portion of your savings.
What are the tax implications of exiting a FCPI?
If you adhere to the holding period, any capital gain from the sale of the shares is exempt from income tax. However, social security contributions of 17.2% (%) remain due on this capital gain. Therefore, the income tax exemption does not cover the entire exit tax liability.
How to choose a good FCPI?
In venture capital, the difference between managers is considerable. It's essential to consider the team's track record, its sector specialization, its ability to source and support innovative SMEs, and its fee structure. Two FCPIs (French venture capital funds) offering the same 18% tax reduction can deliver contrasting results: the manager's selection is far more important than the tax rate.
Why entrust the choice of a FCPI to Balmont Conseil?
Because the success of a FCPI (French venture capital fund) depends on the quality of the manager, which is difficult for an individual to assess. Balmont Conseil, a member firm of ANACOFI (French National Association of Investment Companies), is not affiliated with any management company: we compare FCPIs based on the track record and specialization of their teams, and only select those that deserve it, allocating them appropriately to your investment portfolio.
Results are provided for illustrative and educational purposes only, based on the parameters entered and simplified assumptions (2026 tax year, constant return, excluding inflation). They do not constitute personalized investment advice, tax advice, or an offer to subscribe. Some investments carry a risk of capital loss. Before making any decision, consult an advisor.
