Paris-based ad holding company Publicis Groupe and one of its clients, France Telecom-Orange (FTO), confirmed they are teaming with Iris Capital Management to manage a series of funds that will invest nearly $400 million in European and global digital startups. Under the plan, the holding company and FTO will acquire nearly half of Iris.
Publicis first confirmed plans to launch the investment funds last fall, but at the time said it was still talking to potential administrators, with Iris among them.
Publicis and FTO have confirmed they will invest an initial $200 million in the startups. A group of other investors are also anteing up, including the European Investment Fund and French investment company CDC Entreprises, part of Groupe Caisse des Dépôts.
To start, Iris will manage three separate funds, including a ventures growth vehicle that will target established companies in France and Europe, providing up to roughly $20 million per project. There will also be a global investment fund for startups outside Europe that will provide up to $20 million per project. Both the growth and global funds are commencing operations immediately, Publicis said.
A third fund -- for early-stage investment of up to $4 million per project -- will kick off in the second quarter of 2012. All investment decisions will be made by an independent investment committee.
Publicis Groupe CEO Maurice Levy said the plan is “to get funds flowing to businesses as fast as possible so they can flourish.”
Under the funding agreement, both Publicis and FTO will acquire 24.5% stakes in Paris-based Iris. Iris management will retain a controlling 51% interest, and the company will continue to be run by Pierre de Fouquet and Antoine Garrigues.
With their investment stakes Publicis’ Levy becomes chairman of Iris’ supervisory board and Gevais Pellissier, deputy CEO of FTO, has been named deputy chairman of the board. Iris, formed in 1986, has invested more than $1.1 billion in more than 200 companies since its launch. Recent investments include the French company Mediastay, an online games platform and Berlin-based search engine optimization company Searchmetrics.