Orange and Publicis create digital start-up fund

08/11/2011

France Télécom-Orange and the Publicis Groupe advertising business are planning to launch a new venture capital fund. The fund - which is starting with a 150 million Euro (£129 million) investment from the two companies - will help budding entrepreneurs in Europe’s digital economy.

08/11/2011

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Additional funding from other investors is expected to bring total funding to 300 million Euro.

A management company will be responsible for the new fund, with investment decisions made by a committee that’s independent of France Telecom-Orange and Publicis Groupe.

The fund’s targets for investment will be companies focusing on digital technology, content and services, including online marketing, e-commerce, mobile content and services, online gaming and social networks, as well as supporting technologies including middleware, cloud computing, security, and online payments.

Seed capital and early-stage investment will target fledgling companies in France and Europe, with investments of up to €1 million.

Later-stage financing for more established companies in France and Europe will provide up to €15 million, while at a later stage the fund may opt to invest in start-ups outside Europe, alongside American or Asian partner funds.

Stéphane Richard, Chairman and Chief Executive Officer of France Telecom-Orange, said “French investment capital has been suffering for far too long from the absence of a solid ecosystem to link young companies together with larger groups, research centers and government systems.

“We’re very happy to be working with Publicis Groupe to finance and support digital start-up projects. This is a surging growth market and it’s an important challenge: our job will be to contribute to the emergence of tomorrow’s leaders. From the point of view of France Télécom-Orange, the new fund complements our investments in R&D, as well as creating a terrific opportunity to be present at the birth of growth projects.”

Separately, Orange has acquired a 34.15% minority stake in Cascadia, the company newly formed to hold radio group Skyrock’s web operations, for €14 million.

According to Orange, where Skyrock.com is the leading blog platform in France among the 12-24 age group in terms of pages viewed, recording nearly one billion page views per month.

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