A record year for investments in the startup ecosystem in Italy: adding together the rounds for raising capital, crowdfunding and Business Angel investments that finance companies through the purchase of shares, in the first 6 months of 2021 €651 million were invested in startups and innovative companies. Eleven startups raised between 10 and 100 million euros, 28 between 1 and 10 million, and the remaining raised 1 million and below.
Six exceptional months if you think that, in all of 2020, total investments had just exceeded 700 million. If this trend continues, the conditions would be in place to close the year with over 1 billion investments in Italy for innovative startups.
But let's take a step back: what is a startup? It is a newly established company, not necessarily operating in the hi-tech or ICT sectors, which promotes an innovative or incremental product or service compared to those offered on the market. To be considered a startup, within a short period of a few months the company must be established, and the product must be launched to market.
According to the legislation – the Startup Act (DL 179/2012, art. 25, paragraph 2) – an innovative startup is a corporation, also established in cooperative form, which meets the following requirements:
- Cannot have been established for more than five years, which is why we talk about "young companies"
- They must be based in Italy or in a European Union member country
- Starting from the second year of activity, the total production approved in the last balance sheet must not exceed 5 million euros
- The company cannot distribute profits generated by the production and sale of services or goods
- The corporate purpose in the by-laws at the time of registration must be the development, production or marketing of innovative products or services with high technological value
- Startups cannot be listed on financial markets
- Startup cannot be established by merger, company split or as a result of the transfer of another company
Finally, an innovative startup, to be considered as such, must meet at least one of the following three criteria:
- Take on expenses in research, development and innovation equal to at least 15% of the greater value between turnover and cost of production
- Employment of highly qualified personnel (at least 1/3 PhD, PhD students or researchers, or at least 2/3 with a master's degree)
- Ownership, deposit or license of at least one patent, or the ownership of a registered software