For me, the story starts on Tuesday 21 January. A source in police and judicial circles in Paris asks whether I know Ledger, and tells me that one of its bosses has apparently been kidnapped that day. Had I never dealt with this person before, I’d have assumed it was fake, especially as I can’t find the slightest trace of it online. But before going any further, he asks me not to mention the case in any form whatsoever until it is over.
At that point, like many people no doubt, I thought of the very media-friendly Eric Larchevêque.
Because before he sat on the panel of Qui Veut Être Mon Associé, the French Dragons’ Den on the channel M6, alongside Anthony Bourbon (who created Blast during the show (in French), with Larchevêque as its public face) and Tony Parker from the same show, Larchevêque was above all an entrepreneur.
In 2014, with Thomas France, he set up La Maison du Bitcoin, which would later become a CEX under the name Coinhouse, one of the very first physical places in the world where you could buy Bitcoin. In 2017, the platform, renamed by then, joined “the Arizen group”, in the official wording widely repeated at the time, without anyone really knowing what this “group” actually was. Behind Arizen, in fact created for the occasion, stood notably Nicolas Louvet1, a former partner at Serena with long experience in tech and VC, who also happens to be one of the very first investors in… Ledger. The following year, Louvet obtained CIF status2 from the CNCIF3, and the fintech became the first French platform regulated by the AMF, France’s financial markets regulator4. Two months later, under pressure from many CIFs who had complained to the AMF and the ACPR, the banking and insurance supervisor, the CNCIF backtracked and withdrew the approval, explaining that the AMF did not allow crypto to be filed under “miscellaneous goods”, and that a seller of crypto-assets therefore could not count as a CIF. It would take until 2019 and the Pacte law, a sweeping French business-reform act, for PSAN status5 to appear.
As for Ledger, the company was actually set up much earlier, in 2011, under the name Epic Dream, by Larchevêque (95%) and Bruno L., even if the real business only came much later. In 2012, Thomas France came in, then in 2014 the company merged first with Radioceros/ChronoCoin (Joël P., David Balland, Vanessa R.) and then with BTChip (Nicolas Bacca, Cédric M., Olivier T.). Which led to what would become the first product: the Ledger Nano, a physical hardware wallet to keep your crypto safe.
At that point there were 10 main shareholders, including the 8 co-founders, most of whom are still involved:
Ledger then embarked on a string of funding rounds to pay for its product and its growth, notably in 20156, when Pascal Gauthier, former COO of the French adtech firm Criteo (he took part in its Nasdaq IPO), joined the cap table and the board, then €7M in 2017 in a €7M round led by Maif Avenir, the venture arm of a French mutual insurer7, then €75M in 20188, which paid for bringing production back home to a €10M factory in Vierzon, a small town in the Cher, in central France.
The choice of town was no accident. Larchevêque lives there, Joel P. isn’t far away, and neither is Balland.
In 2019, Ledger was hit by the Bitcoin crash: sales fell -50% and the company had to cut 10% of its workforce9. Increasingly challenged, Larchevêque faced a revolt from his board, led in particular by the chief executive he had appointed himself to support him: Pascal Gauthier.
The problem was actually fairly classic: Ledger had raised a lot, hired expensively, and the slightest hiccup in growth meant the burn became completely disconnected from revenue. The product was there, it worked, but nobody wanted it any more, because the crypto market was collapsing. The restructuring was signed off, and a war began between Gauthier and Larchevêque, each trying to push the other out.
Larchevêque thought his legitimacy came from being a co-founder; Gauthier thought his came from his track record, and above all from the board. Which has the final say anyway. In reality, by that point it was all settled. Larchevêque’s missteps had long since convinced the board that he had to go, and nobody believed in his vision any more. Gauthier, on the other hand, a shrewd operator who knew the system and its politics inside out, had built up a big lead.
All those funding rounds meant Larchevêque no longer held a majority, and the shareholders’ agreement no longer gave him any room, especially as his co-founders weren’t really backing him either. As one early investor puts it:
“Ledger started doing well when Larchevêque left”
How cruel.
In 2021, Ledger’s Series C, led by 10T10, put its valuation at $1.5bn, followed by a further €100M raise11, but at a valuation of only $1.4bn, in Q1 2023. At least according to the figures announced in the press. Because according to internal documents, the valuations and amounts are rather different.
At the time of the Series C, 9,100 options were granted to Pascal Gauthier (€8M), and 4 co-founders cashed out: Thomas France and David Balland (€4.5M), Joel P.12 (€5.3M), Cedric M. (€890K). Co-founders and employees then held 31% of the capital.
Just after the Series D, the company had to cut another 12% of its workforce as the crypto market hit rock bottom. But it still regularly made headlines in the specialist and mainstream press, both as a global crypto benchmark and as a flagship of the French Tech, the government-backed banner for the country’s start-up scene.