Milan 15th July, 2014 - the Italian venture capital provides signs of vitality, although the numbers remain limited. According to the research report 'Venture Capital Monitor' - carried out by the Watchdog Venture Capital Monitor of the University Cattaneo of Castellanza, in collaboration with AIFI, the Italian private equity and venture capital association, and with the contribution of Vertis sgr, one of the leading italian investment companies - in 2013 were made 66 new investments in seed (investment in the very first stage of experimentation of a business idea) and start-up (investment in the start of a business idea), an increase of 16% over 2012 (57 deals) and +53% over 2011 (43 deals). Overall were invested €58M in growth from the €49M of 2012.
The report, it said in a statement, stresses the positive impact of the startup decree, which entered into force in December 2012, and the fund's high-tech fund for Southern Italy.
When it comes to venture capital, it is useful to reflect on the fact that it is a capital that enables the translation of new ideas into enterprise or support for the very first phase of activity of a reality still at its early stage, "says Anna Gervasoni, General Manager AIFI" it is, therefore, a capital that allows you to take the first development paths and generates innovative processes able to spray the entire business system. in other words, venture capital is a growth factor and, despite the difficulties of the Italian market, it has fostered over the years the development and evolution of our production system."
The number of active investors (i.e. those who have made at least one transaction during the year) amounted to 31 (32 with the addition of the category of 'business angels'), in line with 2012; the total number of investments amounted to 86 (there were just 57 operations in 2012).
Type and amount of investments
56% of the investment was allocated to startups operations (37 deal) with the average size of the investment equal to that of 2012, i.e. € 800,000. The orientation of investors goes towards the acquisition of the minority shares, 25% on average (it was 30% in 2012). Moreover, almost half of the investment (45%) was made in innovative startups. The figure shows to the positive feedback from venture capital operators in respect of the new type of company, especially when you consider that tax incentives for investment in innovative startups were not yet in force during 2013."
Geographical and sectoral distribution
Lombardy is the region where the largest number of transactions took place, 26% of the market (it was 30% in 2012), followed by Campania and Emilia Romagna, with 12% of the total.
Tuscany marks instead a decrease compared to 2012 when it accounted for 9% of total transactions carried out in Italy; in 2013 were two thirds less, i.e. 3%.
The High-Tech fund for Southern Italy has allowed greater attention to companies in the south of the peninsula. Vertis sgr, for example, in just 4 years has analyzed more than 700 initiatives by investing in 20 startups in the south with good results.
Now thanks to the new fund of funds for venture capital, which will be managed by the Italian Investment Fund, there is hope that the experience will be replicated throughout the country by increasing and enhancing the number of operators dedicated to startups.
As regards the sectoral distribution, ICT monopolize the interest of venture capital investors, with 50% of the investments, in line with 2012; growing sector of industrial products (9% compared with 5% in 2012) and the food industry (5% compared to 2% in 2012). A new sector entered the field, that of the services of sale of products for the leisure industry (2%).
Evolution of the average type of venture capital operations capital in Italy
The problem of "dwarf" startups
In any case, there is the fear of having to face a market divided into many small startups that do not find, however, that second round of investment to grow in size. A risk of dwarf startups also reflected in the data of the VEM report. The 2013 report confirmed the fear that circulated among the insiders. Last year €81M were allocated on early stage investments. In other words, funding for startups are back to 2011 levels. Overall, venture capital and business angel Italians in 2012 have invested €130 M. Very few compared to $3 billion to $30 billion in Europe and the United States. But a lot when you consider that until a few years ago there was a homegrown venture capital market
Venture Capital Monitor™
The Venture Capital Monitor - VEM™ is an observatory that was founded in 2009 at the LIUC - Cattaneo University, in collaboration with AIFI, the Italian Association of Private Equity and Venture Capital, which aims to develop a permanent monitoring on the venture capital activity in Italy. The activity of VEM™ is achieved through the publication of an annual report, commissioned researches and other comparison initiatives between public and private entities involved in the early stage activity in Italy.
Vertis Sgr is an independent management company, the only one in Italy with operative sistes both in Northern and Southern regions. Vertis managers 3 funds, 2 in expansion and 1 in venture capital: expansion capital funds focus on SMEs located in Southern Italy, while the venture capital one invests in digital technologies, still in Southern Italy. The company is now launching a second venture capital fund, "Vertis Venture 2 Technologies", covering all Italian regions with a specific technological focus on robotics, mechatronics and automation, excellences of Italian research and corporate worlds. Independency, direct geographic coverage, track record and know-how are the key elements of Vertis leadership, in the capital markets, allowing superior portfolio selection and management abilities. In the last four years Vertis closed 24 investments, creating 250 new job places and attractive total investments of approximately 57 Mln Euro. For further information: www.vertissgr.it
AIFI - ITALIAN ASSOCIATION OF PRIVATE EQUITY AND VENTURE CAPITAL
AIFI - Italian association of Private Equity and Venture Capital, was founded in 1986 with the goal to develop, coordinate and represent, at institutional level, active subjects in the italian investment market of venture capital. The association is a stable organization of financial institutions which steadily anpointd professionally make investments in companies, in the form of venture capital, through the acquisition, management and disinvestment of stakes mainly in non-listed companies, with an active development of the participated companies. For further information: www.aifi.it
LIUC - UNIVERSITÀ CATTANEO
LIUC - Università Cattaneo was founded in 1991 for initiative for 300 entrepreneurs of the Province of Varese of the high Milan area, joined in a choir competition to realize the project, often with significant capital injection, has as strong tie-up with the companies and the business world, as well as a marked international vocation. The LIUC with its Business, Law and Engineering schools, as well as research centers, Laboratories and Observatories offers undergraduate and postgraduate degree, masters, continuos training course and research on contract basis. Among the active master there is that in Merchant Banking, specifically designed to meed the growing need of professionals expressed by investment banks, Private Equity and Venture Capital firms, investment management companies. The Venture Capital Monitor is a Watchdog focused on the investment activity addressed to the start of new business ventues, which proposes itself as target that of identifying the main market trend by defining possible future developments. For further information: www.liuc.it