The data speaks clearly: 723 million euro invested in Italian start up or start ups founded by Italian investors in 2019. A growth of +38% compared to 2018, when 522 million were invested, a number that is greatly superior to the previous year, which closed at 136 million. “We are improving things but we are still far from achieving the level of other countries” David Casalini, founder of StartupItalia, the largest Italian community devoted to start-ups. “The objective is to become ever more attractive and competitive on an international level”. One thing that stands out in 2019 is the growth of equity crowdfundingthat in the last 12 months collected 55 million euros, a record level growth if you consider that in 2018 the total was 30 million, while in 2017 it was just 11,7 million euros.
But who are these start-uppers? How long do the companies last? Who finances them? How many are there? In Italy it is only been eight years since we started talking about start ups and the focus given to the topic has been fluctuating.
“In 2012, thanks to the former minister Corrado Passera, the register dedicated to start-ups with incentives of 30% for those who decided to invest was created, and after that, nothing” Casalini explains, “but in these last 12 months Italian start-ups have managed to get into the government’s agenda. The Minister for Economic Development Stefano Patuanelli completed work started by Luigi Di Maio for the National Innovation Funds guided by Enrico Resmini: a new 1 billion fund -but which could increase to 2 billion - devoted to direct investments in start ups and Italian Venture Capital funds, with 40% incentives to invest in start ups, that increase to 50% if companies do so . In addition, there was a boom in crowdfunding, i.e. direct investment in start-ups. StartupItalia collected 2.6 million Euros from 2000 investors”.
In Italy around 10 thousand start-ups give work to 60 thousand people. “Outside of our country” Casalini continues, “the situation is different: in the United States, for example, over 100 billion have already been invested every year and among the five highest capital companies are former start ups.
China and the rest of Asia are running at the same speed, while our country is lagging behind, even though in the last five years Italy has gone from 27th to 10th place in terms of total investments in Venture Capital, 9th if we consider the results of the first 9 months of 2019, that saw almost 600 million invested, +90% compared to the same time in 2018. Yet the UK, Germany, France alone represent 70% of investments.
Analyzing data recorded by the Startup Hi-Tech Observatory of the Politecnico di Milano it appears that 78.5% of the total investment recovered by start-ups belongs to the digital sector: 19.75% Life Science and Biotech and 1.75 % to Cleantech & Energy.
In Italy there are about 10 thousand start-ups that give jobs to 60 thousand people.
“In the Italian ecosystem, moreover” Casalini explains, “vertical realities concentrated around traditional ‘made in Italy’ sectors - revisited in a hi-tech and digital perspective - have emerged, such as Foodtech and Winetech, Fashion and advanced Textile sectors, both in terms of intelligent materials and avant-guard production technologies, and digital tourism”.
The average age of people creating start ups in Italy today is higher compared to other countries: “normally entrepreneurs are between 35 and 40 years old , they already have work experience and a great attitude towards risk. This is because bureaucracy is still complex and access to funds even more so. 25 year-olds who want to open a start up often do so abroad where it is easier to get funding”.
Out of all start-ups, 99% fail and only 1% is successful: “and this achieved after 5 years of activity. For start-ups to be competitive,” Casalini concludes, “they need to think outside of national boundaries. And think about internationalization”.