France-based operator Orange flagged the expansion of its venture capital activities with the creation of a new, independent unit called Orange Ventures that will have a pot of around €350 million (US$425.4 million) for startup investments.
Orange Ventures has taken over the portfolio of Orange Digital Ventures, which was launched with an initial funding allocation of €20 million ($24.3 million) in 2015 and grew into a €150 million ($182.4 million) corporate early-stage investment fund.
The aim is to give the VC unit greater freedom to make investment decisions, with a focus on high-growth sectors in traditional Orange territory such as connectivity, cybersecurity, the digital enterprise and financial services, as well as new areas such as e-health. It seems likely that the "digital" has been dropped from the unit's name as it is no longer deemed necessary in today's increasingly digital environment.
With offices in Paris and Dakar, Orange Ventures plans to support startups at all stages of maturity, from seed stage startups in Africa and the Middle East, to more mature companies in Europe and the US, with investments of up to €20 million per financing round. The number of employees in the VC unit has also been increased to 20.
Orange has a long history in VC funding for startups, reflecting its ongoing desire to play a more influential role in the development of network technologies – and its frustration with the traditional vendors.
In 2012, for example, it teamed up with Publicis Groupe and Iris Capital Management to create a European VC investor in the digital economy. Orange and Publicis Groupe contributed a total of about €150 million ($182 million) to the initiative.
As already noted, Orange Digital Ventures followed in 2015. In 2017, the VC unit and four VC partners pledged to invest up to €100 million ($121.6 million) in telecom infrastructure startups over the coming three to four years.
Around the same time, Orange said it would begin nurturing network startups in partnership with social media giant Facebook. The two companies also collaborate through the Telecom Infra Project (TIP), a Facebook-led initiative that was launched in early 2016.
In 2018, Orange Digital Ventures partnered with Google to identify and co-invest in startups based in Europe, the Middle East and Africa.
Furthermore, the French operator also operates the Orange Fab accelerator program, which now has a presence in around 15 countries.
Orange is of course far from alone in supporting startups and innovation: Deutsche Telekom, for example, operates the hubraum tech incubator as well as VC fund Deutsche Telekom Capital Partners. Telefónica runs the Wayra startup incubator and Telefónica Innovation Ventures, among other units, while Vodafone operates Vodafone Ventures and various accelerator programs.
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— Anne Morris, contributing editor, special to Light Reading