A beacon of hope following a challenging period. This is clear from the study conducted by the venture capital firm Vc Hub Italia. According to the study, 70% of Italian startups were hiring in 2020. This trend certainly appears to be sticking around in 2021, with four out of five innovative companies aiming to expand their workforce.
It is a sign that, even in such an uncertain period, companies still strive to grow and improve. “Startups create quality jobs, provide important professional development opportunities and involve their own resources in a growing company”, explains Francesco Cerruti, general manager of VC Hub Italia.
Startups bucking the trend
The numbers don’t lie: startups held firm during the crisis triggered by the COVID-19 health emergency. Indeed, of the 70% of companies that hired, 20% did so by doubling or more than doubling their staff.
The sector was mainly driven by tenacious fintech, service technology, engineering and IT innovation companies. And the most salient data is coming from IT innovation: The number of registrations of innovative startups and SMEs in the ICT sector in 2020 peaked at 2006, marking a 17.9% increase, nearly five points higher than all other sectors (+13.3%), and more than one in three (33.4%) were born online (compared to 31.4% in other sectors).
Like all innovative startups, ICT startups are mainly micro-enterprises: two in every three have up to four employees, equity below €10,000 and a production value ranging between €100,000 and €150,000. Roughly one in five (19.9% to be precise) is founded by under-35s, but very few enterprises are run by women, at only 10.7%.
The specific features of Italian startups
So what makes up the typical startup today? The survey revealed that 73% of companies have a workforce of fewer than 20 employees, while 23% employ between 20 and 70, and only 4% have more than 70. And the majority of them are young: In fact, 63% of the resources are younger than 35, while 90% are under 40.
Other relevant phenomena include the relatively low proportion of women, only one manager in five in the management team is a woman, and the investment that employees make in their companies: one in four workers holds equity or stock options in the company where they work.
What sort of people to innovative enterprises hire?
We can get a clear picture of who gets hired by startups based on two factors. A total of 70% of the startups participating in the research have over 70% university graduates among their employees and 75% of them hire recent graduates with no work experience, reaching a share that can be as high as 30%.
As for the contractual formula, four in five companies hire 80% of their employees on open-ended contracts, mostly in Italy since 70% of the companies have all their employees located in Italy.
The companies looking to expand their workforce further have a very clear vision. VC Hub Italia’s research shows that companies are mainly looking for profiles anchored in technical and scientific backgrounds, but also with skills in engineering, economics and IT.
Forecasts point to engineering and product as the sectors poised for the greatest job growth in the coming years. Yet there is no shortage of hurdles to overcome: Similar to traditional companies, startups also have difficulties in finding specialised profiles. Particularly in software engineering, back-end technology, data management, advanced analytics and product management.