This morning, Orange, a large French telecom, announced that it has secured a number of partner companies to support its fourth startup accelerator batch, forming what it un-ironically and patly calls the Fab Force. The name dings with Microsoft overtones due to Orange calling its accelerator, you guessed it, Orange Fab.
Joining Orange in the Force, as it were, are LG, Visa, Hilton, Fnac, and Moët. It’s a surprisingly diverse group.
If you didn’t know that Orange had an accelerator for startups, don’t worry, I didn’t know either until recently. In an age when even McDonald’s has a startup accelerator, it is easy to miss a few here and there.
I spoke to Orange Fab’s evangelist Pascale Diaine about the company’s effort: Two batches of six to nine companies each year, $20,000 invested by way of a convertible note, and a focus on companies that are more product-ready. According to Diaine, Orange tends to look for companies that are ready to grow their product, putting them a bit after the Y Combinator and 500 Startups age range.
I asked whether $20,00 was too low, and if Orange intended to boost its investment. According to Diaine, the $20,000 figure was originally picked to match what others offered, putting it in keeping with the market. Y Combinator blew up that spot, of course. Diaine indicated that the company was considering boosting its investment amount per startup, perhaps in partnership with the companies that are now partners in the program.
Orange Fab’s new startup class will kick off in December. The company isn’t looking to quicken the cadence of its accelerator, but may increase the size of its classes.
Why are corporations falling over themselves to invest in startups, and build out an incubator or accelerator program? Call it defensive aggression. If you are a wealthy incumbent, as many technology companies are, you both want to build new revenue streams to protect against top line rot, and get an early look into companies that are trying to kill you. And the cost isn’t too great. All billion-dollar-plus companies can afford to do this.
So expect the trend to continue. A caveat: Back in 2000 bubble, one later-noted ‘sign of the times’ was that an incubator for incubators was founded. We’re not quite there yet, I don’t think, but watch out.