French marketing services group High Co. creates dot-com venture capital unit

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PARIS--French direct marketing services group High Co. has announced plans to grow its Internet and new technologies division through the creation of a dot-com venture capital unit baptized High Co. Ventures. WPP Group owns a 30% stake in High Co.

The new "advertising angel" will provide seed money and marketing services to French Internet start-ups in a variety of fields in exchange for minority ownership stakes. In 2000, High Co. plans to invest in Internet start-ups between $5 million and $8 million in cash, plus a far greater amount in services.

High Co., a leading French direct marketing specialist for clients including Kraft Foods and Volkswagen, says its capacity to offer complementary brand-related, direct marketing services online will be at the heart of propositions the new unit will pitch to potential partners.

The new venture advertising arm will function along the lines of a business model High Co. developed in dealings with online merchant

High Co. took an 8% stake in the online retailer in 1999 in exchange for design, marketing and Web site engineering services that have helped turn into one of France's top e-commerce sites. The site reported 180,000 individual visits, 1.5 million pages viewed and nearly $1 million in revenues during the month of February.

The advertising-for-ownership plan is gaining popularity in France, particularly where dot-com ventures are concerned. A number of French ad agencies, including industry leaders Havas Advertising and Publicis Group, haveset up similar venture advertising divisions.

Copyright March 2000, Crain Communications Inc.

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